Correlation Between Citigroup and Eightco Holdings

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

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

Diversification Opportunities for Citigroup and Eightco Holdings

-0.71

Correlation Coefficient

Citigroup  Eightco Holdings

Pay attention - limited upside

The 3 months correlation between Citigroup and Eightco is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Eightco Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eightco Holdings 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 Eightco Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eightco Holdings has no effect on the direction of Citigroup i.e., Citigroup and Eightco Holdings go up and down completely randomly.

Pair Corralation between Citigroup and Eightco Holdings

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.24 times more return on investment than Eightco Holdings. However, Citigroup is 4.25 times less risky than Eightco Holdings. It trades about 0.07 of its potential returns per unit of risk. Eightco Holdings is currently generating about -0.02 per unit of risk. If you would invest  6,022  in Citigroup on September 22, 2024 and sell it today you would earn a total of  897.00  from holding Citigroup or generate 14.9% return on investment over 90 days.

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

Citigroup  vs.  Eightco Holdings

Citigroup

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Citigroup may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Eightco Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eightco Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Citigroup and Eightco Holdings

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

The idea behind Citigroup and Eightco Holdings 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.