Correlation Between Citigroup and Allspring Global
Can any of the company-specific risk be diversified away by investing in both Citigroup and Allspring Global 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 Allspring Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Allspring Global Investment, you can compare the effects of market volatilities on Citigroup and Allspring Global 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 Allspring Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Allspring Global.
Diversification Opportunities for Citigroup and Allspring Global
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and Allspring is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Allspring Global Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allspring Global Inv 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 Allspring Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allspring Global Inv has no effect on the direction of Citigroup i.e., Citigroup and Allspring Global go up and down completely randomly.
Pair Corralation between Citigroup and Allspring Global
Taking into account the 90-day investment horizon Citigroup is expected to generate 7.39 times more return on investment than Allspring Global. However, Citigroup is 7.39 times more volatile than Allspring Global Investment. It trades about 0.07 of its potential returns per unit of risk. Allspring Global Investment is currently generating about 0.14 per unit of risk. If you would invest 6,079 in Citigroup on September 1, 2024 and sell it today you would earn a total of 1,008 from holding Citigroup or generate 16.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Citigroup vs. Allspring Global Investment
Performance |
| Timeline |
| Citigroup |
| Allspring Global Inv |
Citigroup and Allspring Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Allspring Global
The main advantage of trading using opposite Citigroup and Allspring Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Allspring Global 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 Allspring Global will offset losses from the drop in Allspring Global's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Allspring Global vs. Wells Fargo Strategic | Allspring Global vs. Wells Fargo Emerging | Allspring Global vs. Wells Fargo Alternative | Allspring Global vs. Wells Fargo Alternative |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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