Correlation Between Citigroup and Via Renewables

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

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

Diversification Opportunities for Citigroup and Via Renewables

0.94

Correlation Coefficient

Citigroup  Via Renewables

Almost no diversification

The 3 months correlation between Citigroup and Via is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Via Renewables in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Via Renewables 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 Via Renewables. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Via Renewables has no effect on the direction of Citigroup i.e., Citigroup and Via Renewables go up and down completely randomly.

Pair Corralation between Citigroup and Via Renewables

Taking into account the 90-day investment horizon Citigroup is expected to generate 2.2 times more return on investment than Via Renewables. However, Citigroup is 2.2 times more volatile than Via Renewables. It trades about 0.37 of its potential returns per unit of risk. Via Renewables is currently generating about 0.29 per unit of risk. If you would invest  6,762  in Citigroup on April 24, 2025 and sell it today you would earn a total of  2,638  from holding Citigroup or generate 39.01% return on investment over 90 days.

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

Citigroup  vs.  Via Renewables

Citigroup

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 29 (%) 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.

Via Renewables

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Via Renewables are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Via Renewables may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Citigroup and Via Renewables

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

The idea behind Citigroup and Via Renewables 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.