Correlation Between Citigroup and LINGYI ITECH

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Citigroup and LINGYI ITECH 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 LINGYI ITECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and LINGYI ITECH GUAN, you can compare the effects of market volatilities on Citigroup and LINGYI ITECH 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 LINGYI ITECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and LINGYI ITECH.

Diversification Opportunities for Citigroup and LINGYI ITECH

0.24
  Correlation Coefficient

Modest diversification

The 3 months correlation between Citigroup and LINGYI is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and LINGYI ITECH GUAN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LINGYI ITECH GUAN 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 LINGYI ITECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LINGYI ITECH GUAN has no effect on the direction of Citigroup i.e., Citigroup and LINGYI ITECH go up and down completely randomly.

Pair Corralation between Citigroup and LINGYI ITECH

Taking into account the 90-day investment horizon Citigroup is expected to generate 1.12 times less return on investment than LINGYI ITECH. In addition to that, Citigroup is 1.1 times more volatile than LINGYI ITECH GUAN. It trades about 0.34 of its total potential returns per unit of risk. LINGYI ITECH GUAN is currently generating about 0.42 per unit of volatility. If you would invest  487.00  in LINGYI ITECH GUAN on May 15, 2022 and sell it today you would earn a total of  116.00  from holding LINGYI ITECH GUAN or generate 23.82% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy86.36%
ValuesDaily Returns

Citigroup  vs.  LINGYI ITECH GUAN

 Performance (%) 
       Timeline  
Citigroup 
Citigroup Performance
7 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat sluggish fundamental indicators, Citigroup sustained solid returns over the last few months and may actually be approaching a breakup point.

Citigroup Price Channel

LINGYI ITECH GUAN 
LINGYI Performance
16 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in LINGYI ITECH GUAN are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, LINGYI ITECH sustained solid returns over the last few months and may actually be approaching a breakup point.

LINGYI Price Channel

Citigroup and LINGYI ITECH Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Citigroup and LINGYI ITECH

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

LINGYI ITECH GUAN

Pair trading matchups for LINGYI ITECH

Nike vs. LINGYI ITECH
Essential Properties vs. LINGYI ITECH
Prog Hldgs vs. LINGYI ITECH
Semiconductor Bear vs. LINGYI ITECH
Rolls Royce vs. LINGYI ITECH
Cto Realty vs. LINGYI ITECH
Universal Health vs. LINGYI ITECH
Olema Pharmaceuticals vs. LINGYI ITECH
Ark Innovation vs. LINGYI ITECH
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against LINGYI ITECH as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. LINGYI ITECH's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, LINGYI ITECH's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to LINGYI ITECH GUAN.
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.

Other Complementary Tools

Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Go
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Go
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Go
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Go
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Go
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Go
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Go
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Go
Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Go
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Go
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Go
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
Go