Correlation Between Citigroup and UNITED
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By analyzing existing cross correlation between Citigroup and UNITED PARCEL SVC, you can compare the effects of market volatilities on Citigroup and UNITED 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 UNITED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and UNITED.
Diversification Opportunities for Citigroup and UNITED
Very good diversification
The 3 months correlation between Citigroup and UNITED is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and UNITED PARCEL SVC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED PARCEL SVC 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 UNITED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED PARCEL SVC has no effect on the direction of Citigroup i.e., Citigroup and UNITED go up and down completely randomly.
Pair Corralation between Citigroup and UNITED
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.73 times more return on investment than UNITED. However, Citigroup is 2.73 times more volatile than UNITED PARCEL SVC. It trades about 0.08 of its potential returns per unit of risk. UNITED PARCEL SVC is currently generating about 0.01 per unit of risk. If you would invest 6,064 in Citigroup on September 3, 2024 and sell it today you would earn a total of 1,075 from holding Citigroup or generate 17.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 91.2% |
| Values | Daily Returns |
Citigroup vs. UNITED PARCEL SVC
Performance |
| Timeline |
| Citigroup |
| UNITED PARCEL SVC |
Citigroup and UNITED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and UNITED
The main advantage of trading using opposite Citigroup and UNITED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, UNITED 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 UNITED will offset losses from the drop in UNITED'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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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