Correlation Between Citigroup and 21Shares Avalanche

Can any of the company-specific risk be diversified away by investing in both Citigroup and 21Shares Avalanche 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 21Shares Avalanche into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Citigroup and 21Shares Avalanche ETP, you can compare the effects of market volatilities on Citigroup and 21Shares Avalanche 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 21Shares Avalanche. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and 21Shares Avalanche.

Diversification Opportunities for Citigroup and 21Shares Avalanche

-0.02

Correlation Coefficient

Citigroup  21Shares Avalanche

Good diversification

The 3 months correlation between Citigroup and 21Shares is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and 21Shares Avalanche ETP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Avalanche ETP 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 21Shares Avalanche. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Avalanche ETP has no effect on the direction of Citigroup i.e., Citigroup and 21Shares Avalanche go up and down completely randomly.

Pair Corralation between Citigroup and 21Shares Avalanche

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.27 times more return on investment than 21Shares Avalanche. However, Citigroup is 3.66 times less risky than 21Shares Avalanche. It trades about 0.03 of its potential returns per unit of risk. 21Shares Avalanche ETP is currently generating about -0.05 per unit of risk. If you would invest  7,051  in Citigroup on December 27, 2024 and sell it today you would earn a total of  134.00  from holding Citigroup or generate 1.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Citigroup  vs.  21Shares Avalanche ETP

Citigroup

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Citigroup is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

21Shares Avalanche ETP

Risk-Adjusted Performance

Very Weak

Over the last 90 days 21Shares Avalanche ETP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Etf's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the fund sophisticated investors.

Pair Trading with Citigroup and 21Shares Avalanche

The main advantage of trading using opposite Citigroup and 21Shares Avalanche positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, 21Shares Avalanche 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 21Shares Avalanche will offset losses from the drop in 21Shares Avalanche's long position.

The idea behind Citigroup and 21Shares Avalanche ETP 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..