Correlation Between Citigroup and Lyxor Index
Can any of the company-specific risk be diversified away by investing in both Citigroup and Lyxor Index at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Citigroup and Lyxor Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Lyxor Index Fund, you can compare the effects of market volatilities on Citigroup and Lyxor Index 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 Lyxor Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Lyxor Index.
Diversification Opportunities for Citigroup and Lyxor Index
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Lyxor is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Lyxor Index Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor Index Fund 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 Lyxor Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor Index Fund has no effect on the direction of Citigroup i.e., Citigroup and Lyxor Index go up and down completely randomly.
Pair Corralation between Citigroup and Lyxor Index
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.9 times more return on investment than Lyxor Index. However, Citigroup is 1.9 times more volatile than Lyxor Index Fund. It trades about 0.11 of its potential returns per unit of risk. Lyxor Index Fund is currently generating about 0.03 per unit of risk. If you would invest 4,642 in Citigroup on September 4, 2024 and sell it today you would earn a total of 2,500 from holding Citigroup or generate 53.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Citigroup vs. Lyxor Index Fund
Performance |
| Timeline |
| Citigroup |
| Lyxor Index Fund |
Citigroup and Lyxor Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Lyxor Index
The main advantage of trading using opposite Citigroup and Lyxor Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Lyxor Index 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 Lyxor Index will offset losses from the drop in Lyxor Index's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Lyxor Index vs. Lyxor SP 500 | Lyxor Index vs. Lyxor UCITS Daily | Lyxor Index vs. Lyxor UCITS MSCI | Lyxor Index vs. Lyxor Treasury 10Y |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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