Correlation Between CitiGroup and Deutsche Bank
Can any of the company-specific risk be diversified away by investing in both CitiGroup and Deutsche Bank 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 Deutsche Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CitiGroup and Deutsche Bank, you can compare the effects of market volatilities on CitiGroup and Deutsche Bank 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 Deutsche Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of CitiGroup and Deutsche Bank.
Diversification Opportunities for CitiGroup and Deutsche Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CitiGroup and Deutsche is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CitiGroup and Deutsche Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Bank 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 Deutsche Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Bank has no effect on the direction of CitiGroup i.e., CitiGroup and Deutsche Bank go up and down completely randomly.
Pair Corralation between CitiGroup and Deutsche Bank
If you would invest (100.00) in Deutsche Bank on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Deutsche Bank or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CitiGroup vs. Deutsche Bank
Performance |
| Timeline |
| CitiGroup |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Deutsche Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
CitiGroup and Deutsche Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CitiGroup and Deutsche Bank
The main advantage of trading using opposite CitiGroup and Deutsche Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CitiGroup position performs unexpectedly, Deutsche Bank 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 Deutsche Bank will offset losses from the drop in Deutsche Bank's long position.| CitiGroup vs. ProShares Ultra Bloomberg | CitiGroup vs. Direxion Daily Semiconductor | CitiGroup vs. MicroSectors Big Oil | CitiGroup vs. Direxion Daily SP |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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