Correlation Between Citigroup and Iaadx
Can any of the company-specific risk be diversified away by investing in both Citigroup and Iaadx 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 Iaadx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Iaadx, you can compare the effects of market volatilities on Citigroup and Iaadx 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 Iaadx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Iaadx.
Diversification Opportunities for Citigroup and Iaadx
Poor diversification
The 3 months correlation between Citigroup and Iaadx is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Iaadx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iaadx 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 Iaadx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iaadx has no effect on the direction of Citigroup i.e., Citigroup and Iaadx go up and down completely randomly.
Pair Corralation between Citigroup and Iaadx
Taking into account the 90-day investment horizon Citigroup is expected to generate 6.14 times more return on investment than Iaadx. However, Citigroup is 6.14 times more volatile than Iaadx. It trades about 0.1 of its potential returns per unit of risk. Iaadx is currently generating about 0.26 per unit of risk. If you would invest 9,422 in Citigroup on August 31, 2025 and sell it today you would earn a total of 828.00 from holding Citigroup or generate 8.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citigroup vs. Iaadx
Performance |
| Timeline |
| Citigroup |
| Iaadx |
Citigroup and Iaadx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citigroup and Iaadx
The main advantage of trading using opposite Citigroup and Iaadx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Iaadx 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 Iaadx will offset losses from the drop in Iaadx's long position.| Citigroup vs. Yuexiu Transport Infrastructure | Citigroup vs. E Home Household Service | Citigroup vs. Neinor Homes SA | Citigroup vs. Hooker Furniture |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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