Correlation Between Citigroup and Warimpex Finanz

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

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

Diversification Opportunities for Citigroup and Warimpex Finanz

-0.74

Correlation Coefficient

Citigroup  Warimpex Finanz

Pay attention - limited upside

The 3 months correlation between Citigroup and Warimpex is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Warimpex Finanz und in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Warimpex Finanz und 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 Warimpex Finanz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Warimpex Finanz und has no effect on the direction of Citigroup i.e., Citigroup and Warimpex Finanz go up and down completely randomly.

Pair Corralation between Citigroup and Warimpex Finanz

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.46 times more return on investment than Warimpex Finanz. However, Citigroup is 2.19 times less risky than Warimpex Finanz. It trades about 0.2 of its potential returns per unit of risk. Warimpex Finanz und is currently generating about -0.03 per unit of risk. If you would invest  5,683  in Citigroup on September 12, 2024 and sell it today you would earn a total of  1,513  from holding Citigroup or generate 26.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Citigroup  vs.  Warimpex Finanz und

Citigroup

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 16 (%) 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.

Warimpex Finanz und

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Warimpex Finanz und has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's technical and fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Citigroup and Warimpex Finanz

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

The idea behind Citigroup and Warimpex Finanz und 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.

Check out your portfolio center.

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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.