Correlation Between Citigroup and Mazhar Zorlu

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

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

Diversification Opportunities for Citigroup and Mazhar Zorlu

0.69

Correlation Coefficient

Citigroup  Mazhar Zorlu

Poor diversification

The 3 months correlation between Citigroup and Mazhar is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Mazhar Zorlu Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mazhar Zorlu Holding 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 Mazhar Zorlu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mazhar Zorlu Holding has no effect on the direction of Citigroup i.e., Citigroup and Mazhar Zorlu go up and down completely randomly.

Pair Corralation between Citigroup and Mazhar Zorlu

Taking into account the 90-day investment horizon Citigroup is expected to under-perform the Mazhar Zorlu. But the stock apears to be less risky and, when comparing its historical volatility, Citigroup is 2.64 times less risky than Mazhar Zorlu. The stock trades about -0.09 of its potential returns per unit of risk. The Mazhar Zorlu Holding is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  674.00  in Mazhar Zorlu Holding on September 24, 2024 and sell it today you would earn a total of  11.00  from holding Mazhar Zorlu Holding or generate 1.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.24%
Values	Daily Returns

Citigroup  vs.  Mazhar Zorlu Holding

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 uncertain fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

Mazhar Zorlu Holding

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mazhar Zorlu Holding are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong forward indicators, Mazhar Zorlu is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Citigroup and Mazhar Zorlu

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

The idea behind Citigroup and Mazhar Zorlu Holding 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.