Correlation Between Citigroup and JSC National

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

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

Diversification Opportunities for Citigroup and JSC National

0.78

Correlation Coefficient

Citigroup  JSC National

Poor diversification

The 3 months correlation between Citigroup and JSC is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and JSC National Atomic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JSC National Atomic 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 JSC National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JSC National Atomic has no effect on the direction of Citigroup i.e., Citigroup and JSC National go up and down completely randomly.

Pair Corralation between Citigroup and JSC National

Taking into account the 90-day investment horizon Citigroup is expected to generate 1.14 times less return on investment than JSC National. But when comparing it to its historical volatility, Citigroup is 1.58 times less risky than JSC National. It trades about 0.07 of its potential returns per unit of risk. JSC National Atomic is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  2,221  in JSC National Atomic on September 19, 2024 and sell it today you would earn a total of  1,369  from holding JSC National Atomic or generate 61.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.02%
Values	Daily Returns

Citigroup  vs.  JSC National Atomic

Citigroup

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 6 (%) 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 January 2025.

JSC National Atomic

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JSC National Atomic are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, JSC National may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Citigroup and JSC National

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

The idea behind Citigroup and JSC National Atomic 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.

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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.