Correlation Between Citigroup and LINKBANCORP

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

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

Diversification Opportunities for Citigroup and LINKBANCORP

0.43

Correlation Coefficient

Citigroup  LINKBANCORP

Very weak diversification

The 3 months correlation between Citigroup and LINKBANCORP is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and LINKBANCORP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LINKBANCORP 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 LINKBANCORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LINKBANCORP has no effect on the direction of Citigroup i.e., Citigroup and LINKBANCORP go up and down completely randomly.

Pair Corralation between Citigroup and LINKBANCORP

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.73 times more return on investment than LINKBANCORP. However, Citigroup is 1.37 times less risky than LINKBANCORP. It trades about 0.25 of its potential returns per unit of risk. LINKBANCORP is currently generating about 0.06 per unit of risk. If you would invest  7,546  in Citigroup on May 15, 2025 and sell it today you would earn a total of  1,919  from holding Citigroup or generate 25.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Citigroup  vs.  LINKBANCORP

Citigroup

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

LINKBANCORP

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in LINKBANCORP are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent forward-looking signals, LINKBANCORP may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Citigroup and LINKBANCORP

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

The idea behind Citigroup and LINKBANCORP 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.