Correlation Between Citigroup and Allspring Ultra

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

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

Diversification Opportunities for Citigroup and Allspring Ultra

0.52

Correlation Coefficient

Citigroup  Allspring Ultra

Very weak diversification

The 3 months correlation between Citigroup and Allspring is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Allspring Ultra Short Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allspring Ultra Short 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 Allspring Ultra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allspring Ultra Short has no effect on the direction of Citigroup i.e., Citigroup and Allspring Ultra go up and down completely randomly.

Pair Corralation between Citigroup and Allspring Ultra

Taking into account the 90-day investment horizon Citigroup is expected to generate 15.35 times more return on investment than Allspring Ultra. However, Citigroup is 15.35 times more volatile than Allspring Ultra Short Term. It trades about 0.07 of its potential returns per unit of risk. Allspring Ultra Short Term is currently generating about 0.2 per unit of risk. If you would invest  9,470  in Citigroup on August 22, 2025 and sell it today you would earn a total of  513.00  from holding Citigroup or generate 5.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Citigroup  vs.  Allspring Ultra Short Term

Citigroup

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Citigroup is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Allspring Ultra Short

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Allspring Ultra Short Term are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Allspring Ultra 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 Allspring Ultra

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

The idea behind Citigroup and Allspring Ultra Short Term 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.