Correlation Between Bio Techne and Citigroup
Can any of the company-specific risk be diversified away by investing in both Bio Techne 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 Bio Techne and Citigroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bio Techne and Citigroup, you can compare the effects of market volatilities on Bio Techne 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 Bio Techne with a short position of Citigroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bio Techne and Citigroup.
Diversification Opportunities for Bio Techne and Citigroup
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bio and Citigroup is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Bio Techne and Citigroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citigroup and Bio Techne 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 Bio Techne 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 Bio Techne i.e., Bio Techne and Citigroup go up and down completely randomly.
Pair Corralation between Bio Techne and Citigroup
Assuming the 90 days trading horizon Bio Techne is expected to under-perform the Citigroup. In addition to that, Bio Techne is 1.66 times more volatile than Citigroup. It trades about -0.28 of its total potential returns per unit of risk. Citigroup is currently generating about 0.43 per unit of volatility. If you would invest 6,708 in Citigroup on September 12, 2024 and sell it today you would earn a total of 614.00 from holding Citigroup or generate 9.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bio Techne vs. Citigroup
Performance |
| Timeline |
| Bio Techne |
| Citigroup |
Bio Techne and Citigroup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bio Techne and Citigroup
The main advantage of trading using opposite Bio Techne and Citigroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bio Techne 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 Bio Techne and Citigroup 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.| Citigroup vs. Align Technology | Citigroup vs. Apartment Investment and | Citigroup vs. Global X Funds | Citigroup vs. Marvell Technology |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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