Correlation Between Citigroup and Metalla Royalty
Can any of the company-specific risk be diversified away by investing in both Citigroup and Metalla Royalty 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 Metalla Royalty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Metalla Royalty Streaming, you can compare the effects of market volatilities on Citigroup and Metalla Royalty 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 Metalla Royalty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Metalla Royalty.
Diversification Opportunities for Citigroup and Metalla Royalty
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citigroup and Metalla is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Metalla Royalty Streaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metalla Royalty Streaming 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 Metalla Royalty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metalla Royalty Streaming has no effect on the direction of Citigroup i.e., Citigroup and Metalla Royalty go up and down completely randomly.
Pair Corralation between Citigroup and Metalla Royalty
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.31 times more return on investment than Metalla Royalty. However, Citigroup is 3.24 times less risky than Metalla Royalty. It trades about 0.25 of its potential returns per unit of risk. Metalla Royalty Streaming is currently generating about -0.1 per unit of risk. If you would invest 6,815 in Citigroup on September 15, 2024 and sell it today you would earn a total of 286.00 from holding Citigroup or generate 4.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Citigroup vs. Metalla Royalty Streaming
Performance |
| Timeline |
| Citigroup |
| Metalla Royalty Streaming |
Citigroup and Metalla Royalty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Metalla Royalty
The main advantage of trading using opposite Citigroup and Metalla Royalty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Metalla Royalty 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 Metalla Royalty will offset losses from the drop in Metalla Royalty's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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