Correlation Between Citigroup and ST Energy
Can any of the company-specific risk be diversified away by investing in both Citigroup and ST Energy 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 ST Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and ST Energy Transition, you can compare the effects of market volatilities on Citigroup and ST Energy 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 ST Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and ST Energy.
Diversification Opportunities for Citigroup and ST Energy
Pay attention - limited upside
The 3 months correlation between Citigroup and STET is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and ST Energy Transition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ST Energy Transition 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 ST Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ST Energy Transition has no effect on the direction of Citigroup i.e., Citigroup and ST Energy go up and down completely randomly.
Pair Corralation between Citigroup and ST Energy
If you would invest 7,090 in Citigroup on December 2, 2024 and sell it today you would earn a total of 905.00 from holding Citigroup or generate 12.76% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Citigroup vs. ST Energy Transition
Performance |
Timeline |
Citigroup |
ST Energy Transition |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Citigroup and ST Energy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Citigroup and ST Energy
The main advantage of trading using opposite Citigroup and ST Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, ST Energy 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 ST Energy will offset losses from the drop in ST Energy's long position.Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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