Correlation Between Citigroup and Corvus Pharmaceuticals

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

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

Diversification Opportunities for Citigroup and Corvus Pharmaceuticals

-0.6

Correlation Coefficient

Citigroup  Corvus Pharmaceuticals

Excellent diversification

The 3 months correlation between Citigroup and Corvus is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Corvus Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corvus Pharmaceuticals 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 Corvus Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corvus Pharmaceuticals has no effect on the direction of Citigroup i.e., Citigroup and Corvus Pharmaceuticals go up and down completely randomly.

Pair Corralation between Citigroup and Corvus Pharmaceuticals

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.26 times more return on investment than Corvus Pharmaceuticals. However, Citigroup is 3.83 times less risky than Corvus Pharmaceuticals. It trades about 0.12 of its potential returns per unit of risk. Corvus Pharmaceuticals is currently generating about -0.19 per unit of risk. If you would invest  7,038  in Citigroup on November 28, 2024 and sell it today you would earn a total of  776.00  from holding Citigroup or generate 11.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Citigroup  vs.  Corvus Pharmaceuticals

Citigroup

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 9 (%) 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 March 2025.

Corvus Pharmaceuticals

Risk-Adjusted Performance

Very Weak

Over the last 90 days Corvus Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Citigroup and Corvus Pharmaceuticals

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

The idea behind Citigroup and Corvus Pharmaceuticals 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..