Correlation Between Citigroup and Graf Acquisition
Can any of the company-specific risk be diversified away by investing in both Citigroup and Graf Acquisition 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 Graf Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Graf Acquisition Corp, you can compare the effects of market volatilities on Citigroup and Graf Acquisition 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 Graf Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Graf Acquisition.
Diversification Opportunities for Citigroup and Graf Acquisition
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citigroup and Graf is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Graf Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graf Acquisition Corp 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 Graf Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graf Acquisition Corp has no effect on the direction of Citigroup i.e., Citigroup and Graf Acquisition go up and down completely randomly.
Pair Corralation between Citigroup and Graf Acquisition
If you would invest 5,788 in Citigroup on September 16, 2024 and sell it today you would earn a total of 1,313 from holding Citigroup or generate 22.68% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 1.54% |
Values | Daily Returns |
Citigroup vs. Graf Acquisition Corp
Performance |
Timeline |
Citigroup |
Graf Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Citigroup and Graf Acquisition Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Citigroup and Graf Acquisition
The main advantage of trading using opposite Citigroup and Graf Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Graf Acquisition 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 Graf Acquisition will offset losses from the drop in Graf Acquisition's long position.Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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