Correlation Between Dow Jones and CITIGROUP
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By analyzing existing cross correlation between Dow Jones Industrial and CITIGROUP INC 475, you can compare the effects of market volatilities on Dow Jones 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 Dow Jones with a short position of CITIGROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and CITIGROUP.
Diversification Opportunities for Dow Jones and CITIGROUP
Excellent diversification
The 3 months correlation between Dow and CITIGROUP is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and CITIGROUP INC 475 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITIGROUP INC 475 and Dow Jones 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 Dow Jones Industrial 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 475 has no effect on the direction of Dow Jones i.e., Dow Jones and CITIGROUP go up and down completely randomly.
Pair Corralation between Dow Jones and CITIGROUP
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.59 times more return on investment than CITIGROUP. However, Dow Jones Industrial is 1.69 times less risky than CITIGROUP. It trades about 0.12 of its potential returns per unit of risk. CITIGROUP INC 475 is currently generating about 0.02 per unit of risk. If you would invest 3,387,678 in Dow Jones Industrial on September 1, 2024 and sell it today you would earn a total of 1,103,387 from holding Dow Jones Industrial or generate 32.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.31% |
| Values | Daily Returns |
Dow Jones Industrial vs. CITIGROUP INC 475
Performance |
| Timeline |
Dow Jones and CITIGROUP Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
CITIGROUP INC 475
Pair trading matchups for CITIGROUP
Pair Trading with Dow Jones and CITIGROUP
The main advantage of trading using opposite Dow Jones and CITIGROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones 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.| Dow Jones vs. Catalyst Pharmaceuticals | Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. National CineMedia | Dow Jones vs. Mink Therapeutics |
| CITIGROUP vs. Kura Sushi USA | CITIGROUP vs. Boston Properties | CITIGROUP vs. The Wendys Co | CITIGROUP vs. Hooker Furniture |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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