Correlation Between Citigroup and Trisul SA

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

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

Diversification Opportunities for Citigroup and Trisul SA

-0.23

Correlation Coefficient

Citigroup  Trisul SA

Very good diversification

The 3 months correlation between Citigroup and Trisul is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Trisul SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trisul SA 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 Trisul SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trisul SA has no effect on the direction of Citigroup i.e., Citigroup and Trisul SA go up and down completely randomly.

Pair Corralation between Citigroup and Trisul SA

Taking into account the 90-day investment horizon Citigroup is expected to generate 1.01 times less return on investment than Trisul SA. But when comparing it to its historical volatility, Citigroup is 1.71 times less risky than Trisul SA. It trades about 0.06 of its potential returns per unit of risk. Trisul SA is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  316.00  in Trisul SA on October 11, 2024 and sell it today you would earn a total of  119.00  from holding Trisul SA or generate 37.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Citigroup  vs.  Trisul SA

Citigroup

Risk-Adjusted Performance

9 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 9 (%) 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.

Trisul SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Trisul SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Citigroup and Trisul SA

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

The idea behind Citigroup and Trisul SA 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.