Correlation Between CITIGROUP and NL Industries
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By analyzing existing cross correlation between CITIGROUP INC 33 and NL Industries, you can compare the effects of market volatilities on CITIGROUP and NL Industries 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 NL Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIGROUP and NL Industries.
Diversification Opportunities for CITIGROUP and NL Industries
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CITIGROUP and NL Industries is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding CITIGROUP INC 33 and NL Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NL Industries 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 INC 33 are associated (or correlated) with NL Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NL Industries has no effect on the direction of CITIGROUP i.e., CITIGROUP and NL Industries go up and down completely randomly.
Pair Corralation between CITIGROUP and NL Industries
Assuming the 90 days trading horizon CITIGROUP INC 33 is expected to under-perform the NL Industries. But the bond apears to be less risky and, when comparing its historical volatility, CITIGROUP INC 33 is 6.06 times less risky than NL Industries. The bond trades about -0.22 of its potential returns per unit of risk. The NL Industries is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 754.00 in NL Industries on September 3, 2024 and sell it today you would earn a total of 41.00 from holding NL Industries or generate 5.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITIGROUP INC 33 vs. NL Industries
Performance |
| Timeline |
| CITIGROUP INC 33 |
| NL Industries |
CITIGROUP and NL Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITIGROUP and NL Industries
The main advantage of trading using opposite CITIGROUP and NL Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIGROUP position performs unexpectedly, NL Industries 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 NL Industries will offset losses from the drop in NL Industries' long position.| CITIGROUP vs. AEP TEX INC | CITIGROUP vs. US BANK NATIONAL | CITIGROUP vs. Jackson Financial | CITIGROUP vs. MetLife |
| NL Industries vs. Brinks Company | NL Industries vs. Allegion PLC | NL Industries vs. Resideo Technologies | NL Industries vs. Mistras Group |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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