Correlation Between Dupont De and Citigroup
Can any of the company-specific risk be diversified away by investing in both Dupont De and Citigroup 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 Dupont De and Citigroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dupont De Nemours and Citigroup, you can compare the effects of market volatilities on Dupont De 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 Dupont De with a short position of Citigroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Citigroup.
Diversification Opportunities for Dupont De and Citigroup
Excellent diversification
The 3 months correlation between Dupont and Citigroup is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Citigroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citigroup and Dupont De 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 Dupont De Nemours 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 has no effect on the direction of Dupont De i.e., Dupont De and Citigroup go up and down completely randomly.
Pair Corralation between Dupont De and Citigroup
Allowing for the 90-day total investment horizon Dupont De is expected to generate 31.03 times less return on investment than Citigroup. But when comparing it to its historical volatility, Dupont De Nemours is 1.64 times less risky than Citigroup. It trades about 0.02 of its potential returns per unit of risk. Citigroup is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 7,039 in Citigroup on November 1, 2024 and sell it today you would earn a total of 955.00 from holding Citigroup or generate 13.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. Citigroup
Performance |
| Timeline |
| Dupont De Nemours |
| Citigroup |
Dupont De and Citigroup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Citigroup
The main advantage of trading using opposite Dupont De and Citigroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De 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.| Dupont De vs. International Flavors Fragrances | Dupont De vs. Air Products and | Dupont De vs. PPG Industries | Dupont De vs. Linde plc Ordinary |
| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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