Correlation Between Citigroup and MQGAU

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

By analyzing existing cross correlation between Citigroup and MQGAU 4654 27 MAR 29, you can compare the effects of market volatilities on Citigroup and MQGAU 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 MQGAU. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and MQGAU.

Diversification Opportunities for Citigroup and MQGAU

0.51

Correlation Coefficient

Citigroup  MQGAU

Very weak diversification

The 3 months correlation between Citigroup and MQGAU is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and MQGAU 4654 27 MAR 29 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MQGAU 4654 27 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 MQGAU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MQGAU 4654 27 has no effect on the direction of Citigroup i.e., Citigroup and MQGAU go up and down completely randomly.

Pair Corralation between Citigroup and MQGAU

Taking into account the 90-day investment horizon Citigroup is expected to generate 3.09 times more return on investment than MQGAU. However, Citigroup is 3.09 times more volatile than MQGAU 4654 27 MAR 29. It trades about -0.06 of its potential returns per unit of risk. MQGAU 4654 27 MAR 29 is currently generating about -0.59 per unit of risk. If you would invest  7,215  in Citigroup on October 7, 2024 and sell it today you would lose (115.00) from holding Citigroup or give up 1.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	50.0%
Values	Daily Returns

Citigroup  vs.  MQGAU 4654 27 MAR 29

Citigroup

Risk-Adjusted Performance

9 of 100

OK

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.

MQGAU 4654 27

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MQGAU 4654 27 MAR 29 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 MQGAU 4654 27 MAR 29 investors.

Pair Trading with Citigroup and MQGAU

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

The idea behind Citigroup and MQGAU 4654 27 MAR 29 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.