Correlation Between Citigroup and Amundi MSCI

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

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

Diversification Opportunities for Citigroup and Amundi MSCI

-0.4

Correlation Coefficient

Citigroup  Amundi MSCI

Very good diversification

The 3 months correlation between Citigroup and Amundi is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Amundi MSCI UK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi MSCI UK 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 Amundi MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi MSCI UK has no effect on the direction of Citigroup i.e., Citigroup and Amundi MSCI go up and down completely randomly.

Pair Corralation between Citigroup and Amundi MSCI

Taking into account the 90-day investment horizon Citigroup is expected to generate 2.37 times more return on investment than Amundi MSCI. However, Citigroup is 2.37 times more volatile than Amundi MSCI UK. It trades about 0.16 of its potential returns per unit of risk. Amundi MSCI UK is currently generating about -0.07 per unit of risk. If you would invest  6,129  in Citigroup on September 21, 2024 and sell it today you would earn a total of  791.00  from holding Citigroup or generate 12.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	97.78%
Values	Daily Returns

Citigroup  vs.  Amundi MSCI UK

Citigroup

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Citigroup may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Amundi MSCI UK

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amundi MSCI UK has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively invariable basic indicators, Amundi MSCI is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Citigroup and Amundi MSCI

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

The idea behind Citigroup and Amundi MSCI UK 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.