Correlation Between Citigroup and Daklak Pharmaceutical

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

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

Diversification Opportunities for Citigroup and Daklak Pharmaceutical

0.0

Correlation Coefficient

Citigroup  Daklak Pharmaceutical

Pay attention - limited upside

The 3 months correlation between Citigroup and Daklak is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Daklak Pharmaceutical Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daklak Pharmaceutical 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 Daklak Pharmaceutical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daklak Pharmaceutical has no effect on the direction of Citigroup i.e., Citigroup and Daklak Pharmaceutical go up and down completely randomly.

Pair Corralation between Citigroup and Daklak Pharmaceutical

If you would invest  4,168  in Citigroup on September 20, 2024 and sell it today you would earn a total of  2,734  from holding Citigroup or generate 65.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Citigroup  vs.  Daklak Pharmaceutical Medical

Citigroup

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 10 (%) 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.

Daklak Pharmaceutical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Daklak Pharmaceutical Medical has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental drivers, Daklak Pharmaceutical is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Citigroup and Daklak Pharmaceutical

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

The idea behind Citigroup and Daklak Pharmaceutical Medical 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.