Correlation Between Citigroup and Predictive Oncology

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

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

Diversification Opportunities for Citigroup and Predictive Oncology

-0.68

Correlation Coefficient

Citigroup  Predictive Oncology

Excellent diversification

The 3 months correlation between Citigroup and Predictive is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Predictive Oncology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Predictive Oncology 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 Predictive Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Predictive Oncology has no effect on the direction of Citigroup i.e., Citigroup and Predictive Oncology go up and down completely randomly.

Pair Corralation between Citigroup and Predictive Oncology

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.37 times more return on investment than Predictive Oncology. However, Citigroup is 2.71 times less risky than Predictive Oncology. It trades about 0.43 of its potential returns per unit of risk. Predictive Oncology is currently generating about -0.02 per unit of risk. If you would invest  6,219  in Citigroup on April 21, 2025 and sell it today you would earn a total of  3,126  from holding Citigroup or generate 50.27% return on investment over 90 days.

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

Citigroup  vs.  Predictive Oncology

Citigroup

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 34 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

Predictive Oncology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Predictive Oncology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Predictive Oncology is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Citigroup and Predictive Oncology

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

The idea behind Citigroup and Predictive Oncology 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.

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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.