Correlation Between Citigroup and Shore Bancshares

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

Diversification Opportunities for Citigroup and Shore Bancshares

0.89
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Citigroup and Shore is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Shore Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shore Bancshares 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 Shore Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shore Bancshares has no effect on the direction of Citigroup i.e., Citigroup and Shore Bancshares go up and down completely randomly.

Pair Corralation between Citigroup and Shore Bancshares

Taking into account the 90-day investment horizon Citigroup is expected to under-perform the Shore Bancshares. In addition to that, Citigroup is 1.92 times more volatile than Shore Bancshares. It trades about -0.42 of its total potential returns per unit of risk. Shore Bancshares is currently generating about -0.33 per unit of volatility. If you would invest  1,845  in Shore Bancshares on July 5, 2022 and sell it today you would lose (105.00)  from holding Shore Bancshares or give up 5.69% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Citigroup  vs.  Shore Bancshares

 Performance (%) 
       Timeline  
Citigroup 
Citigroup Performance
0 of 100
Over the last 90 days Citigroup has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Citigroup Price Channel

Shore Bancshares 
Shore Performance
0 of 100
Over the last 90 days Shore Bancshares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's fundamental drivers remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Shore Price Channel

Citigroup and Shore Bancshares Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Citigroup and Shore Bancshares

The main advantage of trading using opposite Citigroup and Shore Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Shore Bancshares 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 Shore Bancshares will offset losses from the drop in Shore Bancshares' long position.
Citigroup vs. Amazon Inc
The idea behind Citigroup and Shore Bancshares 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.
Shore Bancshares vs. Amazon Inc
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.

Other Complementary Tools

Content Syndication
Quickly integrate customizable finance content to your own investment portal
Go
Transaction History
View history of all your transactions and understand their impact on performance
Go
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
Go
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Go
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
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
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Go