Correlation Between Citigroup and Zimtu Capital
Can any of the company-specific risk be diversified away by investing in both Citigroup and Zimtu Capital 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 Zimtu Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Zimtu Capital Corp, you can compare the effects of market volatilities on Citigroup and Zimtu Capital 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 Zimtu Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Zimtu Capital.
Diversification Opportunities for Citigroup and Zimtu Capital
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Citigroup and Zimtu is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Zimtu Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zimtu Capital Corp 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 Zimtu Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zimtu Capital Corp has no effect on the direction of Citigroup i.e., Citigroup and Zimtu Capital go up and down completely randomly.
Pair Corralation between Citigroup and Zimtu Capital
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.26 times more return on investment than Zimtu Capital. However, Citigroup is 3.78 times less risky than Zimtu Capital. It trades about 0.07 of its potential returns per unit of risk. Zimtu Capital Corp is currently generating about 0.01 per unit of risk. If you would invest 6,079 in Citigroup on September 1, 2024 and sell it today you would earn a total of 1,008 from holding Citigroup or generate 16.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Zimtu Capital Corp
Performance |
| Timeline |
| Citigroup |
| Zimtu Capital Corp |
Citigroup and Zimtu Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Zimtu Capital
The main advantage of trading using opposite Citigroup and Zimtu Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Zimtu Capital 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 Zimtu Capital will offset losses from the drop in Zimtu Capital's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Zimtu Capital vs. Commerce Resources Corp | Zimtu Capital vs. Great Atlantic Resources | Zimtu Capital vs. Lomiko Metals | Zimtu Capital vs. Focus Graphite |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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