Correlation Between Citigroup and Sa International
Can any of the company-specific risk be diversified away by investing in both Citigroup and Sa International 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 Sa International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Sa International Value, you can compare the effects of market volatilities on Citigroup and Sa International 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 Sa International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Sa International.
Diversification Opportunities for Citigroup and Sa International
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citigroup and SAHMX is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Sa International Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sa International Value 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 Sa International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sa International Value has no effect on the direction of Citigroup i.e., Citigroup and Sa International go up and down completely randomly.
Pair Corralation between Citigroup and Sa International
Taking into account the 90-day investment horizon Citigroup is expected to generate 2.65 times more return on investment than Sa International. However, Citigroup is 2.65 times more volatile than Sa International Value. It trades about 0.2 of its potential returns per unit of risk. Sa International Value is currently generating about -0.02 per unit of risk. If you would invest 5,716 in Citigroup on September 13, 2024 and sell it today you would earn a total of 1,480 from holding Citigroup or generate 25.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Citigroup vs. Sa International Value
Performance |
Timeline |
Citigroup |
Sa International Value |
Citigroup and Sa International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Citigroup and Sa International
The main advantage of trading using opposite Citigroup and Sa International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Sa International 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 Sa International will offset losses from the drop in Sa International's long position.Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
Sa International vs. Voya High Yield | Sa International vs. Buffalo High Yield | Sa International vs. Fidelity Capital Income | Sa International vs. Gmo High Yield |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Stocks Directory Find actively traded stocks across global markets | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |