Correlation Between Citigroup and Wharf Real
Can any of the company-specific risk be diversified away by investing in both Citigroup and Wharf Real 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 Wharf Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Wharf Real Estate, you can compare the effects of market volatilities on Citigroup and Wharf Real 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 Wharf Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Wharf Real.
Diversification Opportunities for Citigroup and Wharf Real
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Citigroup and Wharf is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Wharf Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wharf Real Estate 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 Wharf Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wharf Real Estate has no effect on the direction of Citigroup i.e., Citigroup and Wharf Real go up and down completely randomly.
Pair Corralation between Citigroup and Wharf Real
Taking into account the 90-day investment horizon Citigroup is expected to generate 37.06 times less return on investment than Wharf Real. But when comparing it to its historical volatility, Citigroup is 19.57 times less risky than Wharf Real. It trades about 0.07 of its potential returns per unit of risk. Wharf Real Estate is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 267.00 in Wharf Real Estate on August 31, 2024 and sell it today you would earn a total of 22.00 from holding Wharf Real Estate or generate 8.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 74.48% |
| Values | Daily Returns |
Citigroup vs. Wharf Real Estate
Performance |
| Timeline |
| Citigroup |
| Wharf Real Estate |
Citigroup and Wharf Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Wharf Real
The main advantage of trading using opposite Citigroup and Wharf Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Wharf Real 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 Wharf Real will offset losses from the drop in Wharf Real's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Wharf Real vs. IRSA Inversiones Y | Wharf Real vs. Anywhere Real Estate | Wharf Real vs. Newmark Group | Wharf Real vs. New York City |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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