Correlation Between Citigroup and Avgol Industries
Can any of the company-specific risk be diversified away by investing in both Citigroup and Avgol Industries 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 Avgol Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Avgol Industries 1953, you can compare the effects of market volatilities on Citigroup and Avgol Industries 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 Avgol Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Avgol Industries.
Diversification Opportunities for Citigroup and Avgol Industries
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and Avgol is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Avgol Industries 1953 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avgol Industries 1953 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 Avgol Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avgol Industries 1953 has no effect on the direction of Citigroup i.e., Citigroup and Avgol Industries go up and down completely randomly.
Pair Corralation between Citigroup and Avgol Industries
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.84 times more return on investment than Avgol Industries. However, Citigroup is 1.18 times less risky than Avgol Industries. It trades about -0.05 of its potential returns per unit of risk. Avgol Industries 1953 is currently generating about -0.4 per unit of risk. If you would invest 6,013 in Citigroup on January 20, 2024 and sell it today you would lose (99.00) from holding Citigroup or give up 1.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 86.36% |
| Values | Daily Returns |
Citigroup vs. Avgol Industries 1953
Performance |
| Timeline |
| Citigroup |
| Avgol Industries 1953 |
Citigroup and Avgol Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Avgol Industries
The main advantage of trading using opposite Citigroup and Avgol Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Avgol Industries 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 Avgol Industries will offset losses from the drop in Avgol Industries' long position.| Citigroup vs. JPMorgan Chase Co | Citigroup vs. Wells Fargo | Citigroup vs. Toronto Dominion Bank | Citigroup vs. Nu Holdings |
| Avgol Industries vs. Neto ME Holdings | Avgol Industries vs. Globrands Group | Avgol Industries vs. Nextcom | Avgol Industries vs. Golan Plastic |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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