Correlation Between Citigroup and 21036PBN7

Can any of the company-specific risk be diversified away by investing in both Citigroup and 21036PBN7 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 21036PBN7 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Citigroup and STZ 5 02 FEB 26, you can compare the effects of market volatilities on Citigroup and 21036PBN7 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 21036PBN7. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and 21036PBN7.

Diversification Opportunities for Citigroup and 21036PBN7

-0.25

Correlation Coefficient

Citigroup  21036PBN7

Very good diversification

The 3 months correlation between Citigroup and 21036PBN7 is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and STZ 5 02 FEB 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21036PBN7 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 21036PBN7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21036PBN7 has no effect on the direction of Citigroup i.e., Citigroup and 21036PBN7 go up and down completely randomly.

Pair Corralation between Citigroup and 21036PBN7

Taking into account the 90-day investment horizon Citigroup is expected to generate 6.3 times more return on investment than 21036PBN7. However, Citigroup is 6.3 times more volatile than STZ 5 02 FEB 26. It trades about 0.06 of its potential returns per unit of risk. STZ 5 02 FEB 26 is currently generating about 0.0 per unit of risk. If you would invest  4,524  in Citigroup on October 3, 2024 and sell it today you would earn a total of  2,515  from holding Citigroup or generate 55.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	93.13%
Values	Daily Returns

Citigroup  vs.  STZ 5 02 FEB 26

Citigroup

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

21036PBN7

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days STZ 5 02 FEB 26 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 21036PBN7 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 21036PBN7

The main advantage of trading using opposite Citigroup and 21036PBN7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, 21036PBN7 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 21036PBN7 will offset losses from the drop in 21036PBN7's long position.

The idea behind Citigroup and STZ 5 02 FEB 26 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.