Correlation Between Citigroup and AUSTEVOLL SEAFOOD
Can any of the company-specific risk be diversified away by investing in both Citigroup and AUSTEVOLL SEAFOOD 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 AUSTEVOLL SEAFOOD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and AUSTEVOLL SEAFOOD, you can compare the effects of market volatilities on Citigroup and AUSTEVOLL SEAFOOD 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 AUSTEVOLL SEAFOOD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and AUSTEVOLL SEAFOOD.
Diversification Opportunities for Citigroup and AUSTEVOLL SEAFOOD
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citigroup and AUSTEVOLL is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and AUSTEVOLL SEAFOOD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AUSTEVOLL SEAFOOD 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 AUSTEVOLL SEAFOOD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AUSTEVOLL SEAFOOD has no effect on the direction of Citigroup i.e., Citigroup and AUSTEVOLL SEAFOOD go up and down completely randomly.
Pair Corralation between Citigroup and AUSTEVOLL SEAFOOD
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.41 times less return on investment than AUSTEVOLL SEAFOOD. But when comparing it to its historical volatility, Citigroup is 3.55 times less risky than AUSTEVOLL SEAFOOD. It trades about 0.07 of its potential returns per unit of risk. AUSTEVOLL SEAFOOD is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 380.00 in AUSTEVOLL SEAFOOD on August 31, 2024 and sell it today you would earn a total of 483.00 from holding AUSTEVOLL SEAFOOD or generate 127.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.56% |
| Values | Daily Returns |
Citigroup vs. AUSTEVOLL SEAFOOD
Performance |
| Timeline |
| Citigroup |
| AUSTEVOLL SEAFOOD |
Citigroup and AUSTEVOLL SEAFOOD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and AUSTEVOLL SEAFOOD
The main advantage of trading using opposite Citigroup and AUSTEVOLL SEAFOOD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, AUSTEVOLL SEAFOOD 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 AUSTEVOLL SEAFOOD will offset losses from the drop in AUSTEVOLL SEAFOOD'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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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