Correlation Between Citigroup and Catalyst/smh Total

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

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

Diversification Opportunities for Citigroup and Catalyst/smh Total

0.84

Correlation Coefficient

Citigroup  Catalyst/smh Total

Very poor diversification

The 3 months correlation between Citigroup and Catalyst/smh is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Catalystsmh Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalystsmh Total Return 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 Catalyst/smh Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalystsmh Total Return has no effect on the direction of Citigroup i.e., Citigroup and Catalyst/smh Total go up and down completely randomly.

Pair Corralation between Citigroup and Catalyst/smh Total

Taking into account the 90-day investment horizon Citigroup is expected to generate 2.21 times more return on investment than Catalyst/smh Total. However, Citigroup is 2.21 times more volatile than Catalystsmh Total Return. It trades about 0.24 of its potential returns per unit of risk. Catalystsmh Total Return is currently generating about 0.23 per unit of risk. If you would invest  7,563  in Citigroup on May 19, 2025 and sell it today you would earn a total of  1,806  from holding Citigroup or generate 23.88% return on investment over 90 days.

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

Citigroup  vs.  Catalystsmh Total Return

Citigroup

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 18 (%) 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.

Catalystsmh Total Return

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Catalystsmh Total Return are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Catalyst/smh Total may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Citigroup and Catalyst/smh Total

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

The idea behind Citigroup and Catalystsmh Total Return 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.