Correlation Between Monitronics International and Citigroup
Can any of the company-specific risk be diversified away by investing in both Monitronics International 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 Monitronics International and Citigroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monitronics International and Citigroup, you can compare the effects of market volatilities on Monitronics International 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 Monitronics International with a short position of Citigroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monitronics International and Citigroup.
Diversification Opportunities for Monitronics International and Citigroup
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Monitronics and Citigroup is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Monitronics International and Citigroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citigroup and Monitronics International 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 Monitronics International 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 Monitronics International i.e., Monitronics International and Citigroup go up and down completely randomly.
Pair Corralation between Monitronics International and Citigroup
Given the investment horizon of 90 days Monitronics International is expected to under-perform the Citigroup. In addition to that, Monitronics International is 13.46 times more volatile than Citigroup. It trades about -0.2 of its total potential returns per unit of risk. Citigroup is currently generating about 0.07 per unit of volatility. If you would invest 4,688 in Citigroup on January 17, 2024 and sell it today you would earn a total of 1,168 from holding Citigroup or generate 24.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 19.92% |
| Values | Daily Returns |
Monitronics International vs. Citigroup
Performance |
| Timeline |
| Monitronics International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Citigroup |
Monitronics International and Citigroup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monitronics International and Citigroup
The main advantage of trading using opposite Monitronics International and Citigroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monitronics International 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.| Monitronics International vs. Alto Ingredients | Monitronics International vs. Pinterest | Monitronics International vs. Definitive Healthcare Corp | Monitronics International vs. Q2 Holdings |
| 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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