Correlation Between Amundi SA and Citigroup
Can any of the company-specific risk be diversified away by investing in both Amundi SA and Citigroup 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 Amundi SA and Citigroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi SA and Citigroup, you can compare the effects of market volatilities on Amundi SA and Citigroup 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 Amundi SA with a short position of Citigroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi SA and Citigroup.
Diversification Opportunities for Amundi SA and Citigroup
Weak diversification
The 3 months correlation between Amundi and Citigroup is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Amundi SA and Citigroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citigroup and Amundi SA 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 Amundi SA are associated (or correlated) with Citigroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citigroup has no effect on the direction of Amundi SA i.e., Amundi SA and Citigroup go up and down completely randomly.
Pair Corralation between Amundi SA and Citigroup
Assuming the 90 days horizon Amundi SA is expected to generate 0.8 times more return on investment than Citigroup. However, Amundi SA is 1.25 times less risky than Citigroup. It trades about 0.21 of its potential returns per unit of risk. Citigroup is currently generating about 0.08 per unit of risk. If you would invest 6,647 in Amundi SA on January 25, 2024 and sell it today you would earn a total of 407.00 from holding Amundi SA or generate 6.12% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Amundi SA vs. Citigroup
Performance |
Timeline |
Amundi SA |
Citigroup |
Amundi SA and Citigroup Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Amundi SA and Citigroup
The main advantage of trading using opposite Amundi SA and Citigroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi SA position performs unexpectedly, Citigroup 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 Citigroup will offset losses from the drop in Citigroup's long position.Amundi SA vs. Starfleet Innotech | Amundi SA vs. Flow Capital Corp | Amundi SA vs. Ameritrans Capital Corp | Amundi SA vs. Blackhawk Growth Corp |
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Check out your portfolio center.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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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