Correlation Between Citigroup and SOUTHERN
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By analyzing existing cross correlation between Citigroup and SOUTHERN CALIF GAS, you can compare the effects of market volatilities on Citigroup and SOUTHERN 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 SOUTHERN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and SOUTHERN.
Diversification Opportunities for Citigroup and SOUTHERN
Good diversification
The 3 months correlation between Citigroup and SOUTHERN is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and SOUTHERN CALIF GAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOUTHERN CALIF GAS 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 SOUTHERN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOUTHERN CALIF GAS has no effect on the direction of Citigroup i.e., Citigroup and SOUTHERN go up and down completely randomly.
Pair Corralation between Citigroup and SOUTHERN
Taking into account the 90-day investment horizon Citigroup is expected to generate 157.46 times less return on investment than SOUTHERN. But when comparing it to its historical volatility, Citigroup is 96.81 times less risky than SOUTHERN. It trades about 0.08 of its potential returns per unit of risk. SOUTHERN CALIF GAS is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 8,279 in SOUTHERN CALIF GAS on September 4, 2024 and sell it today you would earn a total of 297.00 from holding SOUTHERN CALIF GAS or generate 3.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 57.91% |
| Values | Daily Returns |
Citigroup vs. SOUTHERN CALIF GAS
Performance |
| Timeline |
| Citigroup |
| SOUTHERN CALIF GAS |
Citigroup and SOUTHERN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and SOUTHERN
The main advantage of trading using opposite Citigroup and SOUTHERN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, SOUTHERN 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 SOUTHERN will offset losses from the drop in SOUTHERN's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| SOUTHERN vs. Tower Semiconductor | SOUTHERN vs. Amkor Technology | SOUTHERN vs. Bluerock Homes Trust | SOUTHERN vs. Morgan Stanley |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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