Correlation Between Citigroup and Partners Iii
Can any of the company-specific risk be diversified away by investing in both Citigroup and Partners Iii 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 Partners Iii into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Partners Iii Opportunity, you can compare the effects of market volatilities on Citigroup and Partners Iii 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 Partners Iii. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Partners Iii.
Diversification Opportunities for Citigroup and Partners Iii
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Citigroup and Partners is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Partners Iii Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Partners Iii Opportunity 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 Partners Iii. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Partners Iii Opportunity has no effect on the direction of Citigroup i.e., Citigroup and Partners Iii go up and down completely randomly.
Pair Corralation between Citigroup and Partners Iii
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.64 times more return on investment than Partners Iii. However, Citigroup is 2.64 times more volatile than Partners Iii Opportunity. It trades about 0.14 of its potential returns per unit of risk. Partners Iii Opportunity is currently generating about 0.14 per unit of risk. If you would invest 6,205 in Citigroup on August 29, 2024 and sell it today you would earn a total of 770.00 from holding Citigroup or generate 12.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Partners Iii Opportunity
Performance |
| Timeline |
| Citigroup |
| Partners Iii Opportunity |
Citigroup and Partners Iii Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Partners Iii
The main advantage of trading using opposite Citigroup and Partners Iii positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Partners Iii 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 Partners Iii will offset losses from the drop in Partners Iii's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Partners Iii vs. Neuberger Berman Long | Partners Iii vs. Neuberger Berman Long | Partners Iii vs. Pimco Rae Worldwide |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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