Correlation Between Citigroup and ZKB Silver
Can any of the company-specific risk be diversified away by investing in both Citigroup and ZKB Silver 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 ZKB Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and ZKB Silver ETF, you can compare the effects of market volatilities on Citigroup and ZKB Silver 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 ZKB Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and ZKB Silver.
Diversification Opportunities for Citigroup and ZKB Silver
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Citigroup and ZKB is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and ZKB Silver ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZKB Silver ETF 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 ZKB Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZKB Silver ETF has no effect on the direction of Citigroup i.e., Citigroup and ZKB Silver go up and down completely randomly.
Pair Corralation between Citigroup and ZKB Silver
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.14 times less return on investment than ZKB Silver. But when comparing it to its historical volatility, Citigroup is 1.65 times less risky than ZKB Silver. It trades about 0.22 of its potential returns per unit of risk. ZKB Silver ETF is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 7,731 in ZKB Silver ETF on September 12, 2024 and sell it today you would earn a total of 364.00 from holding ZKB Silver ETF or generate 4.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Citigroup vs. ZKB Silver ETF
Performance |
| Timeline |
| Citigroup |
| ZKB Silver ETF |
Citigroup and ZKB Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and ZKB Silver
The main advantage of trading using opposite Citigroup and ZKB Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, ZKB Silver 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 ZKB Silver will offset losses from the drop in ZKB Silver's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| ZKB Silver vs. ZKB Silver ETF | ZKB Silver vs. ZKB Gold ETF | ZKB Silver vs. ZKB Gold ETF | ZKB Silver vs. ZKB Platinum ETF |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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