Correlation Between Citigroup and Frontken Bhd
Can any of the company-specific risk be diversified away by investing in both Citigroup and Frontken Bhd 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 Frontken Bhd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Frontken Bhd, you can compare the effects of market volatilities on Citigroup and Frontken Bhd 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 Frontken Bhd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Frontken Bhd.
Diversification Opportunities for Citigroup and Frontken Bhd
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Frontken is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Frontken Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frontken Bhd 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 are associated (or correlated) with Frontken Bhd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frontken Bhd has no effect on the direction of Citigroup i.e., Citigroup and Frontken Bhd go up and down completely randomly.
Pair Corralation between Citigroup and Frontken Bhd
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.8 times more return on investment than Frontken Bhd. However, Citigroup is 1.24 times less risky than Frontken Bhd. It trades about 0.09 of its potential returns per unit of risk. Frontken Bhd is currently generating about 0.01 per unit of risk. If you would invest 5,579 in Citigroup on December 2, 2024 and sell it today you would earn a total of 2,416 from holding Citigroup or generate 43.31% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 98.38% |
Values | Daily Returns |
Citigroup vs. Frontken Bhd
Performance |
Timeline |
Citigroup |
Frontken Bhd |
Citigroup and Frontken Bhd Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Citigroup and Frontken Bhd
The main advantage of trading using opposite Citigroup and Frontken Bhd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Frontken Bhd 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 Frontken Bhd will offset losses from the drop in Frontken Bhd's long position.Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
Frontken Bhd vs. Nova Wellness Group | Frontken Bhd vs. Farm Price Holdings | Frontken Bhd vs. CB Industrial Product | Frontken Bhd vs. Senheng New Retail |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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