Correlation Between Family Dollar and Citigroup
Can any of the company-specific risk be diversified away by investing in both Family Dollar and Citigroup 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 Family Dollar and Citigroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Family Dollar Stores and Citigroup, you can compare the effects of market volatilities on Family Dollar and Citigroup 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 Family Dollar with a short position of Citigroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Family Dollar and Citigroup.
Diversification Opportunities for Family Dollar and Citigroup
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Family and Citigroup is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Family Dollar Stores and Citigroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citigroup and Family Dollar 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 Family Dollar Stores are associated (or correlated) with Citigroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citigroup has no effect on the direction of Family Dollar i.e., Family Dollar and Citigroup go up and down completely randomly.
Pair Corralation between Family Dollar and Citigroup
If you would invest 5,571 in Citigroup on December 29, 2023 and sell it today you would earn a total of 704.00 from holding Citigroup or generate 12.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Family Dollar Stores vs. Citigroup
Performance |
Timeline |
Family Dollar Stores |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Citigroup |
Family Dollar and Citigroup Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Family Dollar and Citigroup
The main advantage of trading using opposite Family Dollar and Citigroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Family Dollar position performs unexpectedly, Citigroup 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 Citigroup will offset losses from the drop in Citigroup's long position.Family Dollar vs. Relx PLC ADR | Family Dollar vs. John Wiley Sons | Family Dollar vs. Cars Inc | Family Dollar vs. Dana Inc |
Citigroup vs. Bank Of America | Citigroup vs. Deckers Outdoor | Citigroup vs. Intuitive Machines | Citigroup vs. Liberty Interactive LLC |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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