Correlation Between Citigroup and Helen Of

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

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

Diversification Opportunities for Citigroup and Helen Of

0.32

Correlation Coefficient

Citigroup  Helen Of

Weak diversification

The 3 months correlation between Citigroup and Helen is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Helen of Troy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helen of Troy 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 Helen Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helen of Troy has no effect on the direction of Citigroup i.e., Citigroup and Helen Of go up and down completely randomly.

Pair Corralation between Citigroup and Helen Of

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.88 times more return on investment than Helen Of. However, Citigroup is 1.14 times less risky than Helen Of. It trades about 0.03 of its potential returns per unit of risk. Helen of Troy is currently generating about -0.07 per unit of risk. If you would invest  6,991  in Citigroup on December 28, 2024 and sell it today you would earn a total of  194.00  from holding Citigroup or generate 2.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Citigroup  vs.  Helen of Troy

Citigroup

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 2 (%) 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.

Helen of Troy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Helen of Troy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's essential indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Citigroup and Helen Of

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

The idea behind Citigroup and Helen of Troy 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .