Correlation Between Citigroup and Weitz Balanced
Can any of the company-specific risk be diversified away by investing in both Citigroup and Weitz Balanced 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 Weitz Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Weitz Balanced, you can compare the effects of market volatilities on Citigroup and Weitz Balanced 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 Weitz Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Weitz Balanced.
Diversification Opportunities for Citigroup and Weitz Balanced
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Weitz is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Weitz Balanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weitz Balanced 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 Weitz Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weitz Balanced has no effect on the direction of Citigroup i.e., Citigroup and Weitz Balanced go up and down completely randomly.
Pair Corralation between Citigroup and Weitz Balanced
Taking into account the 90-day investment horizon Citigroup is expected to generate 4.56 times more return on investment than Weitz Balanced. However, Citigroup is 4.56 times more volatile than Weitz Balanced. It trades about 0.1 of its potential returns per unit of risk. Weitz Balanced is currently generating about 0.1 per unit of risk. If you would invest 4,362 in Citigroup on August 29, 2024 and sell it today you would earn a total of 2,654 from holding Citigroup or generate 60.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Weitz Balanced
Performance |
| Timeline |
| Citigroup |
| Weitz Balanced |
Citigroup and Weitz Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Weitz Balanced
The main advantage of trading using opposite Citigroup and Weitz Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Weitz Balanced 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 Weitz Balanced will offset losses from the drop in Weitz Balanced's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Weitz Balanced vs. Absolute Convertible Arbitrage | Weitz Balanced vs. Putnam Convertible Incm Gwth | Weitz Balanced vs. Fidelity Sai Convertible | Weitz Balanced vs. Advent Claymore Convertible |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stocks Directory Find actively traded stocks across global markets |