Correlation Between Grupo Televisa and Citigroup
Can any of the company-specific risk be diversified away by investing in both Grupo Televisa 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 Grupo Televisa and Citigroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Televisa SAB and Citigroup, you can compare the effects of market volatilities on Grupo Televisa 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 Grupo Televisa with a short position of Citigroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Televisa and Citigroup.
Diversification Opportunities for Grupo Televisa and Citigroup
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grupo and Citigroup is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Televisa SAB and Citigroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citigroup and Grupo Televisa 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 Grupo Televisa SAB 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 Grupo Televisa i.e., Grupo Televisa and Citigroup go up and down completely randomly.
Pair Corralation between Grupo Televisa and Citigroup
Assuming the 90 days horizon Grupo Televisa is expected to generate 2.94 times less return on investment than Citigroup. In addition to that, Grupo Televisa is 2.3 times more volatile than Citigroup. It trades about 0.08 of its total potential returns per unit of risk. Citigroup is currently generating about 0.56 per unit of volatility. 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 | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Grupo Televisa SAB vs. Citigroup
Performance |
Timeline |
Grupo Televisa SAB |
Citigroup |
Grupo Televisa and Citigroup Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Grupo Televisa and Citigroup
The main advantage of trading using opposite Grupo Televisa and Citigroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Televisa 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.Grupo Televisa vs. Verizon Communications | Grupo Televisa vs. International Business Machines | Grupo Televisa vs. ATT Inc | Grupo Televisa vs. Comcast Corp |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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