Correlation Between Citigroup and Amgen
Can any of the company-specific risk be diversified away by investing in both Citigroup and Amgen 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 Amgen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Amgen Inc, you can compare the effects of market volatilities on Citigroup and Amgen 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 Amgen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Amgen.
Diversification Opportunities for Citigroup and Amgen
Excellent diversification
The 3 months correlation between Citigroup and Amgen is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Amgen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amgen Inc 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 Amgen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amgen Inc has no effect on the direction of Citigroup i.e., Citigroup and Amgen go up and down completely randomly.
Pair Corralation between Citigroup and Amgen
Taking into account the 90-day investment horizon Citigroup is expected to generate 1.39 times more return on investment than Amgen. However, Citigroup is 1.39 times more volatile than Amgen Inc. It trades about 0.05 of its potential returns per unit of risk. Amgen Inc is currently generating about -0.12 per unit of risk. If you would invest 6,166 in Citigroup on January 26, 2024 and sell it today you would earn a total of 81.00 from holding Citigroup or generate 1.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Amgen Inc
Performance |
| Timeline |
| Citigroup |
| Amgen Inc |
Citigroup and Amgen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Amgen
The main advantage of trading using opposite Citigroup and Amgen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Amgen 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 Amgen will offset losses from the drop in Amgen's long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |