Correlation Between Citigroup and High Sierra

Can any of the company-specific risk be diversified away by investing in both Citigroup and High Sierra 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 High Sierra into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Citigroup and High Sierra Technologies, you can compare the effects of market volatilities on Citigroup and High Sierra 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 High Sierra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and High Sierra.

Diversification Opportunities for Citigroup and High Sierra

0.0

Correlation Coefficient

Citigroup  High Sierra

Pay attention - limited upside

The 3 months correlation between Citigroup and High is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and High Sierra Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Sierra Technologies 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 High Sierra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Sierra Technologies has no effect on the direction of Citigroup i.e., Citigroup and High Sierra go up and down completely randomly.

Pair Corralation between Citigroup and High Sierra

If you would invest  110.00  in High Sierra Technologies on January 20, 2024 and sell it today you would earn a total of  0.00  from holding High Sierra Technologies or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Citigroup  vs.  High Sierra Technologies

Citigroup

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Citigroup may actually be approaching a critical reversion point that can send shares even higher in May 2024.

High Sierra Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days High Sierra Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, High Sierra is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Citigroup and High Sierra

The main advantage of trading using opposite Citigroup and High Sierra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, High Sierra 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 High Sierra will offset losses from the drop in High Sierra's long position.

The idea behind Citigroup and High Sierra Technologies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Money Managers module to screen money managers from public funds and ETFs managed around the world.