Correlation Between Centessa Pharmaceuticals and CITIGROUP
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By analyzing existing cross correlation between Centessa Pharmaceuticals PLC and CITIGROUP INC, you can compare the effects of market volatilities on Centessa Pharmaceuticals and CITIGROUP 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 Centessa Pharmaceuticals with a short position of CITIGROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centessa Pharmaceuticals and CITIGROUP.
Diversification Opportunities for Centessa Pharmaceuticals and CITIGROUP
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Centessa and CITIGROUP is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Centessa Pharmaceuticals PLC and CITIGROUP INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITIGROUP INC and Centessa Pharmaceuticals 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 Centessa Pharmaceuticals PLC are associated (or correlated) with CITIGROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CITIGROUP INC has no effect on the direction of Centessa Pharmaceuticals i.e., Centessa Pharmaceuticals and CITIGROUP go up and down completely randomly.
Pair Corralation between Centessa Pharmaceuticals and CITIGROUP
Given the investment horizon of 90 days Centessa Pharmaceuticals PLC is expected to generate 6.5 times more return on investment than CITIGROUP. However, Centessa Pharmaceuticals is 6.5 times more volatile than CITIGROUP INC. It trades about 0.17 of its potential returns per unit of risk. CITIGROUP INC is currently generating about 0.01 per unit of risk. If you would invest 880.00 in Centessa Pharmaceuticals PLC on September 3, 2024 and sell it today you would earn a total of 911.00 from holding Centessa Pharmaceuticals PLC or generate 103.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Centessa Pharmaceuticals PLC vs. CITIGROUP INC
Performance |
| Timeline |
| Centessa Pharmaceuticals |
| CITIGROUP INC |
Centessa Pharmaceuticals and CITIGROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centessa Pharmaceuticals and CITIGROUP
The main advantage of trading using opposite Centessa Pharmaceuticals and CITIGROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centessa Pharmaceuticals position performs unexpectedly, CITIGROUP 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 CITIGROUP will offset losses from the drop in CITIGROUP's long position.The idea behind Centessa Pharmaceuticals PLC and CITIGROUP INC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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