Correlation Between Citigroup and Mantaro Silver

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

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

Diversification Opportunities for Citigroup and Mantaro Silver

-0.68

Correlation Coefficient

Citigroup  Mantaro Silver

Excellent diversification

The 3 months correlation between Citigroup and Mantaro is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Mantaro Silver Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mantaro Silver 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 Mantaro Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mantaro Silver Corp has no effect on the direction of Citigroup i.e., Citigroup and Mantaro Silver go up and down completely randomly.

Pair Corralation between Citigroup and Mantaro Silver

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.19 times more return on investment than Mantaro Silver. However, Citigroup is 5.16 times less risky than Mantaro Silver. It trades about 0.12 of its potential returns per unit of risk. Mantaro Silver Corp is currently generating about -0.07 per unit of risk. If you would invest  6,092  in Citigroup on August 31, 2024 and sell it today you would earn a total of  924.00  from holding Citigroup or generate 15.17% return on investment over 90 days.

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

Citigroup  vs.  Mantaro Silver Corp

Citigroup

Risk-Adjusted Performance

9 of 100

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 exhibited solid returns over the last few months and may actually be approaching a breakup point.

Mantaro Silver Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mantaro Silver Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Citigroup and Mantaro Silver

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

The idea behind Citigroup and Mantaro Silver Corp 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.