Correlation Between Citigroup and NextTrip
Can any of the company-specific risk be diversified away by investing in both Citigroup and NextTrip 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 NextTrip into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and NextTrip, you can compare the effects of market volatilities on Citigroup and NextTrip 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 NextTrip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and NextTrip.
Diversification Opportunities for Citigroup and NextTrip
Very weak diversification
The 3 months correlation between Citigroup and NextTrip is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and NextTrip in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NextTrip 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 NextTrip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NextTrip has no effect on the direction of Citigroup i.e., Citigroup and NextTrip go up and down completely randomly.
Pair Corralation between Citigroup and NextTrip
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.28 times more return on investment than NextTrip. However, Citigroup is 3.55 times less risky than NextTrip. It trades about -0.03 of its potential returns per unit of risk. NextTrip is currently generating about -0.3 per unit of risk. If you would invest 6,346 in Citigroup on January 29, 2024 and sell it today you would lose (80.00) from holding Citigroup or give up 1.26% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Citigroup vs. NextTrip
Performance |
Timeline |
Citigroup |
NextTrip |
Citigroup and NextTrip Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Citigroup and NextTrip
The main advantage of trading using opposite Citigroup and NextTrip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, NextTrip 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 NextTrip will offset losses from the drop in NextTrip's long position.Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
NextTrip vs. Genpact Limited | NextTrip vs. Fiserv Inc | NextTrip vs. Gartner | NextTrip vs. Kyndryl Holdings |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |