Correlation Between Citigroup and Moatech

Can any of the company-specific risk be diversified away by investing in both Citigroup and Moatech 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 Moatech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Citigroup and Moatech Co, you can compare the effects of market volatilities on Citigroup and Moatech 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 Moatech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Moatech.

Diversification Opportunities for Citigroup and Moatech

-0.57

Correlation Coefficient

Citigroup  Moatech

Excellent diversification

The 3 months correlation between Citigroup and Moatech is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Moatech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moatech 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 Moatech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moatech has no effect on the direction of Citigroup i.e., Citigroup and Moatech go up and down completely randomly.

Pair Corralation between Citigroup and Moatech

Taking into account the 90-day investment horizon Citigroup is expected to generate 1.05 times more return on investment than Moatech. However, Citigroup is 1.05 times more volatile than Moatech Co. It trades about 0.24 of its potential returns per unit of risk. Moatech Co is currently generating about -0.14 per unit of risk. If you would invest  6,360  in Citigroup on October 27, 2024 and sell it today you would earn a total of  1,788  from holding Citigroup or generate 28.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	96.77%
Values	Daily Returns

Citigroup  vs.  Moatech Co

Citigroup

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

Moatech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Moatech Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Citigroup and Moatech

The main advantage of trading using opposite Citigroup and Moatech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Moatech 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 Moatech will offset losses from the drop in Moatech's long position.

The idea behind Citigroup and Moatech Co 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.

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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.