Correlation Between Citigroup and Tishman Speyer

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

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

Diversification Opportunities for Citigroup and Tishman Speyer

0.86

Correlation Coefficient

Citigroup  Tishman Speyer

Very poor diversification

The 3 months correlation between Citigroup and Tishman is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Tishman Speyer Renda in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tishman Speyer Renda 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 Tishman Speyer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tishman Speyer Renda has no effect on the direction of Citigroup i.e., Citigroup and Tishman Speyer go up and down completely randomly.

Pair Corralation between Citigroup and Tishman Speyer

Taking into account the 90-day investment horizon Citigroup is expected to generate 7.63 times more return on investment than Tishman Speyer. However, Citigroup is 7.63 times more volatile than Tishman Speyer Renda. It trades about 0.4 of its potential returns per unit of risk. Tishman Speyer Renda is currently generating about 0.24 per unit of risk. If you would invest  6,977  in Citigroup on October 22, 2024 and sell it today you would earn a total of  1,022  from holding Citigroup or generate 14.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	89.47%
Values	Daily Returns

Citigroup  vs.  Tishman Speyer Renda

Citigroup

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 17 (%) 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.

Tishman Speyer Renda

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Tishman Speyer Renda are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong technical and fundamental indicators, Tishman Speyer 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 Tishman Speyer

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

The idea behind Citigroup and Tishman Speyer Renda 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.