Correlation Between Citigroup and VGI Public
Can any of the company-specific risk be diversified away by investing in both Citigroup and VGI Public 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 VGI Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and VGI Public, you can compare the effects of market volatilities on Citigroup and VGI Public 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 VGI Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and VGI Public.
Diversification Opportunities for Citigroup and VGI Public
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and VGI is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and VGI Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VGI Public 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 VGI Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VGI Public has no effect on the direction of Citigroup i.e., Citigroup and VGI Public go up and down completely randomly.
Pair Corralation between Citigroup and VGI Public
Taking into account the 90-day investment horizon Citigroup is expected to generate 56.4 times less return on investment than VGI Public. But when comparing it to its historical volatility, Citigroup is 47.1 times less risky than VGI Public. It trades about 0.07 of its potential returns per unit of risk. VGI Public is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 144.00 in VGI Public on August 31, 2024 and sell it today you would earn a total of 138.00 from holding VGI Public or generate 95.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.64% |
| Values | Daily Returns |
Citigroup vs. VGI Public
Performance |
| Timeline |
| Citigroup |
| VGI Public |
Citigroup and VGI Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and VGI Public
The main advantage of trading using opposite Citigroup and VGI Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, VGI Public 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 VGI Public will offset losses from the drop in VGI Public's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| VGI Public vs. BTS Group Holdings | VGI Public vs. WHA Public | VGI Public vs. Plan B Media | VGI Public vs. Gulf Energy Development |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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