Correlation Between Citigroup and Partners Value
Can any of the company-specific risk be diversified away by investing in both Citigroup and Partners Value 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 Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Partners Value Fund, you can compare the effects of market volatilities on Citigroup and Partners Value 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 Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Partners Value.
Diversification Opportunities for Citigroup and Partners Value
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 Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Partners Value 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 Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Partners Value has no effect on the direction of Citigroup i.e., Citigroup and Partners Value go up and down completely randomly.
Pair Corralation between Citigroup and Partners Value
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.74 times more return on investment than Partners Value. However, Citigroup is 1.74 times more volatile than Partners Value Fund. It trades about 0.07 of its potential returns per unit of risk. Partners Value Fund is currently generating about 0.06 per unit of risk. If you would invest 4,206 in Citigroup on August 26, 2024 and sell it today you would earn a total of 2,778 from holding Citigroup or generate 66.05% 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 Value Fund
Performance |
| Timeline |
| Citigroup |
| Partners Value |
Citigroup and Partners Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Partners Value
The main advantage of trading using opposite Citigroup and Partners Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Partners Value 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 Value will offset losses from the drop in Partners Value's long position.| Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings | Citigroup vs. HSBC Holdings PLC | Citigroup vs. Bank of Montreal |
| Partners Value vs. Partners Value Fund | Partners Value vs. Clipper Fund Inc | Partners Value vs. Longleaf Partners Fund | Partners Value vs. Third Avenue Value |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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