Correlation Between Citigroup and Wilmington Large-cap
Can any of the company-specific risk be diversified away by investing in both Citigroup and Wilmington Large-cap 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 Wilmington Large-cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Wilmington Large Cap Strategy, you can compare the effects of market volatilities on Citigroup and Wilmington Large-cap 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 Wilmington Large-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Wilmington Large-cap.
Diversification Opportunities for Citigroup and Wilmington Large-cap
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Citigroup and Wilmington is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Wilmington Large Cap Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmington Large 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 Wilmington Large-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmington Large Cap has no effect on the direction of Citigroup i.e., Citigroup and Wilmington Large-cap go up and down completely randomly.
Pair Corralation between Citigroup and Wilmington Large-cap
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.79 times more return on investment than Wilmington Large-cap. However, Citigroup is 2.79 times more volatile than Wilmington Large Cap Strategy. It trades about 0.26 of its potential returns per unit of risk. Wilmington Large Cap Strategy is currently generating about 0.38 per unit of risk. If you would invest 6,361 in Citigroup on September 1, 2024 and sell it today you would earn a total of 726.00 from holding Citigroup or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Citigroup vs. Wilmington Large Cap Strategy
Performance |
| Timeline |
| Citigroup |
| Wilmington Large Cap |
Citigroup and Wilmington Large-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Wilmington Large-cap
The main advantage of trading using opposite Citigroup and Wilmington Large-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Wilmington Large-cap 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 Wilmington Large-cap will offset losses from the drop in Wilmington Large-cap's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Wilmington Large-cap vs. Wilmington Multi Manager Real | Wilmington Large-cap vs. Ab Centrated Growth | Wilmington Large-cap vs. T Rowe Price | Wilmington Large-cap vs. T Rowe Price |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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