Correlation Between Citigroup and Calvert Fund

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

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

Diversification Opportunities for Citigroup and Calvert Fund

-0.43

Correlation Coefficient

Citigroup  Calvert Fund

Very good diversification

The 3 months correlation between Citigroup and Calvert is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Calvert Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Fund 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 Calvert Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Fund has no effect on the direction of Citigroup i.e., Citigroup and Calvert Fund go up and down completely randomly.

Pair Corralation between Citigroup and Calvert Fund

If you would invest  7,075  in Citigroup on September 25, 2024 and sell it today you would earn a total of  25.00  from holding Citigroup or generate 0.35% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Citigroup  vs.  Calvert Fund

Citigroup

Risk-Adjusted Performance

12 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

Calvert Fund

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Calvert Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Calvert Fund is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Citigroup and Calvert Fund

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

The idea behind Citigroup and Calvert Fund 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.

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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.