Correlation Between Citigroup and Ivy Mid
Can any of the company-specific risk be diversified away by investing in both Citigroup and Ivy Mid 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 Ivy Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Ivy Mid Cap, you can compare the effects of market volatilities on Citigroup and Ivy Mid 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 Ivy Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Ivy Mid.
Diversification Opportunities for Citigroup and Ivy Mid
Very good diversification
The 3 months correlation between Citigroup and Ivy is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Ivy Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ivy Mid Cap 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 Ivy Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ivy Mid Cap has no effect on the direction of Citigroup i.e., Citigroup and Ivy Mid go up and down completely randomly.
Pair Corralation between Citigroup and Ivy Mid
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.02 times more return on investment than Ivy Mid. However, Citigroup is 2.02 times more volatile than Ivy Mid Cap. It trades about -0.02 of its potential returns per unit of risk. Ivy Mid Cap is currently generating about -0.29 per unit of risk. If you would invest 8,051 in Citigroup on November 27, 2024 and sell it today you would lose (86.00) from holding Citigroup or give up 1.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Ivy Mid Cap
Performance |
| Timeline |
| Citigroup |
| Ivy Mid Cap |
Citigroup and Ivy Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Ivy Mid
The main advantage of trading using opposite Citigroup and Ivy Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Ivy Mid 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 Ivy Mid will offset losses from the drop in Ivy Mid's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Ivy Mid vs. Optimum Small Mid Cap | Ivy Mid vs. Optimum Small Mid Cap | Ivy Mid vs. First Investors Select | Ivy Mid vs. First Investors Select |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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