Correlation Between Citigroup and Quantex Fund

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

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

Diversification Opportunities for Citigroup and Quantex Fund

0.47

Correlation Coefficient

Citigroup  Quantex Fund

Very weak diversification

The 3 months correlation between Citigroup and Quantex is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Quantex Fund Adviser in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantex Fund Adviser 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 Quantex Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantex Fund Adviser has no effect on the direction of Citigroup i.e., Citigroup and Quantex Fund go up and down completely randomly.

Pair Corralation between Citigroup and Quantex Fund

Taking into account the 90-day investment horizon Citigroup is expected to generate 2.77 times less return on investment than Quantex Fund. In addition to that, Citigroup is 2.27 times more volatile than Quantex Fund Adviser. It trades about 0.03 of its total potential returns per unit of risk. Quantex Fund Adviser is currently generating about 0.2 per unit of volatility. If you would invest  3,973  in Quantex Fund Adviser on July 5, 2024 and sell it today you would earn a total of  137.00  from holding Quantex Fund Adviser or generate 3.45% return on investment over 90 days.

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

Citigroup  vs.  Quantex Fund Adviser

Citigroup

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Citigroup has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Citigroup is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Quantex Fund Adviser

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Quantex Fund Adviser are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Quantex Fund is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Citigroup and Quantex Fund

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

The idea behind Citigroup and Quantex Fund Adviser 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.