Correlation Between CITIGROUP CDR and Intact Financial

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

By analyzing existing cross correlation between CITIGROUP CDR and Intact Financial, you can compare the effects of market volatilities on CITIGROUP CDR and Intact Financial 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 CDR with a short position of Intact Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIGROUP CDR and Intact Financial.

Diversification Opportunities for CITIGROUP CDR and Intact Financial

-0.41

Correlation Coefficient

CITIGROUP CDR  Intact Financial

Very good diversification

The 3 months correlation between CITIGROUP and Intact is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding CITIGROUP CDR and Intact Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intact Financial and CITIGROUP CDR 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 CDR are associated (or correlated) with Intact Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intact Financial has no effect on the direction of CITIGROUP CDR i.e., CITIGROUP CDR and Intact Financial go up and down completely randomly.

Pair Corralation between CITIGROUP CDR and Intact Financial

Assuming the 90 days trading horizon CITIGROUP CDR is expected to generate 1.22 times more return on investment than Intact Financial. However, CITIGROUP CDR is 1.22 times more volatile than Intact Financial. It trades about 0.23 of its potential returns per unit of risk. Intact Financial is currently generating about -0.1 per unit of risk. If you would invest  3,174  in CITIGROUP CDR on May 18, 2025 and sell it today you would earn a total of  746.00  from holding CITIGROUP CDR or generate 23.5% return on investment over 90 days.

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

CITIGROUP CDR  vs.  Intact Financial

CITIGROUP CDR

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CITIGROUP CDR are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating technical and fundamental indicators, CITIGROUP CDR exhibited solid returns over the last few months and may actually be approaching a breakup point.

Intact Financial

Risk-Adjusted Performance

Weakest

Over the last 90 days Intact Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with CITIGROUP CDR and Intact Financial

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

The idea behind CITIGROUP CDR and Intact Financial 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 Transaction History module to view history of all your transactions and understand their impact on performance.