Correlation Between Citigroup and Vanguard Advice
Can any of the company-specific risk be diversified away by investing in both Citigroup and Vanguard Advice 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 Vanguard Advice into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Vanguard Advice Select, you can compare the effects of market volatilities on Citigroup and Vanguard Advice 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 Vanguard Advice. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Vanguard Advice.
Diversification Opportunities for Citigroup and Vanguard Advice
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Vanguard is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Vanguard Advice Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Advice Select 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 Vanguard Advice. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Advice Select has no effect on the direction of Citigroup i.e., Citigroup and Vanguard Advice go up and down completely randomly.
Pair Corralation between Citigroup and Vanguard Advice
Taking into account the 90-day investment horizon Citigroup is expected to under-perform the Vanguard Advice. In addition to that, Citigroup is 2.95 times more volatile than Vanguard Advice Select. It trades about -0.04 of its total potential returns per unit of risk. Vanguard Advice Select is currently generating about -0.1 per unit of volatility. If you would invest 3,006 in Vanguard Advice Select on November 28, 2024 and sell it today you would lose (34.00) from holding Vanguard Advice Select or give up 1.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. Vanguard Advice Select
Performance |
| Timeline |
| Citigroup |
| Vanguard Advice Select |
Citigroup and Vanguard Advice Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Vanguard Advice
The main advantage of trading using opposite Citigroup and Vanguard Advice positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Vanguard Advice 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 Vanguard Advice will offset losses from the drop in Vanguard Advice's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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