Correlation Between CITIGROUP and Dow Jones
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By analyzing existing cross correlation between CITIGROUP INC 44 and Dow Jones Industrial, you can compare the effects of market volatilities on CITIGROUP and Dow Jones 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 Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIGROUP and Dow Jones.
Diversification Opportunities for CITIGROUP and Dow Jones
Good diversification
The 3 months correlation between CITIGROUP and Dow is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding CITIGROUP INC 44 and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial 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 44 are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of CITIGROUP i.e., CITIGROUP and Dow Jones go up and down completely randomly.
Pair Corralation between CITIGROUP and Dow Jones
Assuming the 90 days trading horizon CITIGROUP is expected to generate 4.17 times less return on investment than Dow Jones. But when comparing it to its historical volatility, CITIGROUP INC 44 is 2.35 times less risky than Dow Jones. It trades about 0.15 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 4,238,757 in Dow Jones Industrial on August 29, 2024 and sell it today you would earn a total of 247,274 from holding Dow Jones Industrial or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITIGROUP INC 44 vs. Dow Jones Industrial
Performance |
| Timeline |
CITIGROUP and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
CITIGROUP INC 44
Pair trading matchups for CITIGROUP
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with CITIGROUP and Dow Jones
The main advantage of trading using opposite CITIGROUP and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIGROUP position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| CITIGROUP vs. Franklin Wireless Corp | CITIGROUP vs. Eastern Co | CITIGROUP vs. Alta Equipment Group | CITIGROUP vs. Air Lease |
| Dow Jones vs. CECO Environmental Corp | Dow Jones vs. Western Acquisition Ventures | Dow Jones vs. Tyson Foods | Dow Jones vs. Inflection Point Acquisition |
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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