Correlation Between Citigroup and Sunfun Info

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

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

Diversification Opportunities for Citigroup and Sunfun Info

-0.23

Correlation Coefficient

Citigroup  Sunfun Info

Very good diversification

The 3 months correlation between Citigroup and Sunfun is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Sunfun Info Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunfun Info 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 Sunfun Info. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunfun Info has no effect on the direction of Citigroup i.e., Citigroup and Sunfun Info go up and down completely randomly.

Pair Corralation between Citigroup and Sunfun Info

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.57 times more return on investment than Sunfun Info. However, Citigroup is 1.76 times less risky than Sunfun Info. It trades about 0.4 of its potential returns per unit of risk. Sunfun Info Co is currently generating about -0.11 per unit of risk. If you would invest  7,135  in Citigroup on October 26, 2024 and sell it today you would earn a total of  1,034  from holding Citigroup or generate 14.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	85.71%
Values	Daily Returns

Citigroup  vs.  Sunfun Info 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.

Sunfun Info

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sunfun Info Co are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Sunfun Info showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Citigroup and Sunfun Info

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

The idea behind Citigroup and Sunfun Info 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..