Correlation Between Citigroup and Finisterre Unconstrained

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

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

Diversification Opportunities for Citigroup and Finisterre Unconstrained

0.0

Correlation Coefficient

Citigroup  Finisterre Unconstrained

Pay attention - limited upside

The 3 months correlation between Citigroup and Finisterre is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Finisterre Unconstrained Emerg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finisterre Unconstrained 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 Finisterre Unconstrained. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finisterre Unconstrained has no effect on the direction of Citigroup i.e., Citigroup and Finisterre Unconstrained go up and down completely randomly.

Pair Corralation between Citigroup and Finisterre Unconstrained

If you would invest  6,815  in Citigroup on September 15, 2024 and sell it today you would earn a total of  286.00  from holding Citigroup or generate 4.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Citigroup  vs.  Finisterre Unconstrained Emerg

Citigroup

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 13 (%) 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.

Finisterre Unconstrained

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Finisterre Unconstrained Emerging has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental drivers, Finisterre Unconstrained is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Citigroup and Finisterre Unconstrained

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

The idea behind Citigroup and Finisterre Unconstrained Emerging 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.