Correlation Between Citigroup and Acropolis Infrastructure

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

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

Diversification Opportunities for Citigroup and Acropolis Infrastructure

-0.07

Correlation Coefficient

Citigroup  Acropolis Infrastructure

Good diversification

The 3 months correlation between Citigroup and Acropolis is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Acropolis Infrastructure Acqui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acropolis Infrastructure 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 Acropolis Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acropolis Infrastructure has no effect on the direction of Citigroup i.e., Citigroup and Acropolis Infrastructure go up and down completely randomly.

Pair Corralation between Citigroup and Acropolis Infrastructure

If you would invest  5,937  in Citigroup on September 18, 2024 and sell it today you would earn a total of  1,212  from holding Citigroup or generate 20.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Citigroup  vs.  Acropolis Infrastructure Acqui

Citigroup

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

Acropolis Infrastructure

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acropolis Infrastructure Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Acropolis Infrastructure is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Citigroup and Acropolis Infrastructure

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

The idea behind Citigroup and Acropolis Infrastructure Acquisition 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 Global Correlations module to find global opportunities by holding instruments from different markets.