Correlation Between Citigroup and Plymouth Rock

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

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

Diversification Opportunities for Citigroup and Plymouth Rock

-0.84

Correlation Coefficient

Citigroup  Plymouth Rock

Pay attention - limited upside

The 3 months correlation between Citigroup and Plymouth is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Plymouth Rock Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plymouth Rock Techno 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 Plymouth Rock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plymouth Rock Techno has no effect on the direction of Citigroup i.e., Citigroup and Plymouth Rock go up and down completely randomly.

Pair Corralation between Citigroup and Plymouth Rock

If you would invest  7,186  in Citigroup on October 10, 2024 and sell it today you would earn a total of  140.00  from holding Citigroup or generate 1.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	4.76%
Values	Daily Returns

Citigroup  vs.  Plymouth Rock Technologies

Citigroup

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 11 (%) 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.

Plymouth Rock Techno

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Plymouth Rock Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Plymouth Rock is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Citigroup and Plymouth Rock

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

The idea behind Citigroup and Plymouth Rock Technologies 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.