Correlation Between Citigroup and Tortoise Capital

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

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

Diversification Opportunities for Citigroup and Tortoise Capital

0.26

Correlation Coefficient

Citigroup  Tortoise Capital

Modest diversification

The 3 months correlation between Citigroup and Tortoise is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Tortoise Capital Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tortoise Capital Series 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 Tortoise Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tortoise Capital Series has no effect on the direction of Citigroup i.e., Citigroup and Tortoise Capital go up and down completely randomly.

Pair Corralation between Citigroup and Tortoise Capital

Taking into account the 90-day investment horizon Citigroup is expected to generate 1.85 times more return on investment than Tortoise Capital. However, Citigroup is 1.85 times more volatile than Tortoise Capital Series. It trades about 0.36 of its potential returns per unit of risk. Tortoise Capital Series is currently generating about 0.02 per unit of risk. If you would invest  7,003  in Citigroup on May 2, 2025 and sell it today you would earn a total of  2,574  from holding Citigroup or generate 36.76% 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.  Tortoise Capital Series

Citigroup

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 28 (%) 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.

Tortoise Capital Series

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Tortoise Capital Series are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Tortoise Capital is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Citigroup and Tortoise Capital

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

The idea behind Citigroup and Tortoise Capital Series 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.