Correlation Between Citigroup and LOWES
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By analyzing existing cross correlation between Citigroup and LOWES INC 37, you can compare the effects of market volatilities on Citigroup and LOWES and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Citigroup with a short position of LOWES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and LOWES.
Diversification Opportunities for Citigroup and LOWES
Excellent diversification
The 3 months correlation between Citigroup and LOWES is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and LOWES INC 37 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOWES INC 37 and Citigroup is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Citigroup are associated (or correlated) with LOWES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOWES INC 37 has no effect on the direction of Citigroup i.e., Citigroup and LOWES go up and down completely randomly.
Pair Corralation between Citigroup and LOWES
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.25 times more return on investment than LOWES. However, Citigroup is 1.25 times more volatile than LOWES INC 37. It trades about 0.09 of its potential returns per unit of risk. LOWES INC 37 is currently generating about 0.01 per unit of risk. If you would invest 4,479 in Citigroup on September 12, 2024 and sell it today you would earn a total of 2,771 from holding Citigroup or generate 61.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.42% |
| Values | Daily Returns |
Citigroup vs. LOWES INC 37
Performance |
| Timeline |
| Citigroup |
| LOWES INC 37 |
Citigroup and LOWES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and LOWES
The main advantage of trading using opposite Citigroup and LOWES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, LOWES can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in LOWES will offset losses from the drop in LOWES's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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