Correlation Between Citigroup and GASBCM

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

By analyzing existing cross correlation between Citigroup and GASBCM 6129 23 FEB 38, you can compare the effects of market volatilities on Citigroup and GASBCM 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 GASBCM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and GASBCM.

Diversification Opportunities for Citigroup and GASBCM

0.37

Correlation Coefficient

Citigroup  GASBCM

Weak diversification

The 3 months correlation between Citigroup and GASBCM is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and GASBCM 6129 23 FEB 38 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GASBCM 6129 23 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 GASBCM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GASBCM 6129 23 has no effect on the direction of Citigroup i.e., Citigroup and GASBCM go up and down completely randomly.

Pair Corralation between Citigroup and GASBCM

Taking into account the 90-day investment horizon Citigroup is expected to generate 1.97 times more return on investment than GASBCM. However, Citigroup is 1.97 times more volatile than GASBCM 6129 23 FEB 38. It trades about 0.09 of its potential returns per unit of risk. GASBCM 6129 23 FEB 38 is currently generating about 0.0 per unit of risk. If you would invest  4,950  in Citigroup on September 20, 2024 and sell it today you would earn a total of  1,952  from holding Citigroup or generate 39.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	27.31%
Values	Daily Returns

Citigroup  vs.  GASBCM 6129 23 FEB 38

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 unfluctuating fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

GASBCM 6129 23

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GASBCM 6129 23 FEB 38 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for GASBCM 6129 23 FEB 38 investors.

Pair Trading with Citigroup and GASBCM

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

The idea behind Citigroup and GASBCM 6129 23 FEB 38 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.