Correlation Between CITIGROUP and 00108WAF7

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both CITIGROUP and 00108WAF7 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 CITIGROUP and 00108WAF7 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITIGROUP INC and AEP TEX INC, you can compare the effects of market volatilities on CITIGROUP and 00108WAF7 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 00108WAF7. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIGROUP and 00108WAF7.

Diversification Opportunities for CITIGROUP and 00108WAF7

0.11
  Correlation Coefficient

Average diversification

The 3 months correlation between CITIGROUP and 00108WAF7 is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding CITIGROUP INC and AEP TEX INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEP TEX INC 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 are associated (or correlated) with 00108WAF7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEP TEX INC has no effect on the direction of CITIGROUP i.e., CITIGROUP and 00108WAF7 go up and down completely randomly.

Pair Corralation between CITIGROUP and 00108WAF7

Assuming the 90 days trading horizon CITIGROUP is expected to generate 2199.04 times less return on investment than 00108WAF7. But when comparing it to its historical volatility, CITIGROUP INC is 324.97 times less risky than 00108WAF7. It trades about 0.02 of its potential returns per unit of risk. AEP TEX INC is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  7,455  in AEP TEX INC on September 1, 2024 and sell it today you would lose (366.00) from holding AEP TEX INC or give up 4.91% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy65.31%
ValuesDaily Returns

CITIGROUP INC  vs.  AEP TEX INC

 Performance 
       Timeline  
CITIGROUP INC 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CITIGROUP INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, CITIGROUP is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.
AEP TEX INC 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in AEP TEX INC are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat fragile basic indicators, 00108WAF7 sustained solid returns over the last few months and may actually be approaching a breakup point.

CITIGROUP and 00108WAF7 Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CITIGROUP and 00108WAF7

The main advantage of trading using opposite CITIGROUP and 00108WAF7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIGROUP position performs unexpectedly, 00108WAF7 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 00108WAF7 will offset losses from the drop in 00108WAF7's long position.
CITIGROUP vs. IPG Photonics
CITIGROUP vs. Chemours Co
CITIGROUP vs. Summit Materials
CITIGROUP vs. Olympic Steel
The idea behind CITIGROUP INC and AEP TEX INC 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.
00108WAF7 vs. AKITA Drilling
00108WAF7 vs. GameStop Corp
00108WAF7 vs. Contagious Gaming
00108WAF7 vs. Awilco Drilling PLC
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.

Other Complementary Tools

Price Transformation
Use Price Transformation models to analyze the depth of different equity instruments across global markets
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
ETFs
Find actively traded Exchange Traded Funds (ETF) from around the world
FinTech Suite
Use AI to screen and filter profitable investment opportunities


 
Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions
 
Feedback Blog
Made with optimal in San Francisco
2024 Macroaxis LLC
COMMON DESTINATIONS
MAIN CATEGORIES
COMPANY