Correlation Between Wendys and CITIGROUP
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By analyzing existing cross correlation between The Wendys Co and CITIGROUP INC 475, you can compare the effects of market volatilities on Wendys 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 Wendys with a short position of CITIGROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wendys and CITIGROUP.
Diversification Opportunities for Wendys and CITIGROUP
Very weak diversification
The 3 months correlation between Wendys and CITIGROUP is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding The Wendys Co 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 Wendys 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 The Wendys Co 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 Wendys i.e., Wendys and CITIGROUP go up and down completely randomly.
Pair Corralation between Wendys and CITIGROUP
Considering the 90-day investment horizon The Wendys Co is expected to under-perform the CITIGROUP. In addition to that, Wendys is 2.12 times more volatile than CITIGROUP INC 475. It trades about -0.05 of its total potential returns per unit of risk. CITIGROUP INC 475 is currently generating about -0.06 per unit of volatility. If you would invest 8,737 in CITIGROUP INC 475 on November 30, 2024 and sell it today you would lose (215.00) from holding CITIGROUP INC 475 or give up 2.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Wendys Co vs. CITIGROUP INC 475
Performance |
| Timeline |
| The Wendys |
| CITIGROUP INC 475 |
Wendys and CITIGROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wendys and CITIGROUP
The main advantage of trading using opposite Wendys and CITIGROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wendys 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.| Wendys vs. Yum Brands | Wendys vs. Dominos Pizza Common | Wendys vs. Darden Restaurants | Wendys vs. Papa Johns International |
| CITIGROUP vs. Torm PLC Class | CITIGROUP vs. Hillman Solutions Corp | CITIGROUP vs. Estee Lauder Companies | CITIGROUP vs. Weyco 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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