Correlation Between Citigroup and Avidity Biosciences

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

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

Diversification Opportunities for Citigroup and Avidity Biosciences

0.37

Correlation Coefficient

Citigroup  Avidity Biosciences

Weak diversification

The 3 months correlation between Citigroup and Avidity is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Avidity Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avidity Biosciences 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 Avidity Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avidity Biosciences has no effect on the direction of Citigroup i.e., Citigroup and Avidity Biosciences go up and down completely randomly.

Pair Corralation between Citigroup and Avidity Biosciences

Taking into account the 90-day investment horizon Citigroup is expected to generate 3.19 times less return on investment than Avidity Biosciences. But when comparing it to its historical volatility, Citigroup is 2.72 times less risky than Avidity Biosciences. It trades about 0.1 of its potential returns per unit of risk. Avidity Biosciences is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  616.00  in Avidity Biosciences on August 17, 2025 and sell it today you would earn a total of  6,464  from holding Avidity Biosciences or generate 1049.35% return on investment over 90 days.

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

Citigroup  vs.  Avidity Biosciences

Citigroup

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, Citigroup may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Avidity Biosciences

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Avidity Biosciences are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Avidity Biosciences sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Citigroup and Avidity Biosciences

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

The idea behind Citigroup and Avidity Biosciences 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.