Correlation Between Citigroup and Accsys Technologies

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

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

Diversification Opportunities for Citigroup and Accsys Technologies

-0.74

Correlation Coefficient

Citigroup  Accsys Technologies

Pay attention - limited upside

The 3 months correlation between Citigroup and Accsys is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Accsys Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accsys Technologies 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 Accsys Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accsys Technologies has no effect on the direction of Citigroup i.e., Citigroup and Accsys Technologies go up and down completely randomly.

Pair Corralation between Citigroup and Accsys Technologies

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.86 times more return on investment than Accsys Technologies. However, Citigroup is 1.16 times less risky than Accsys Technologies. It trades about 0.16 of its potential returns per unit of risk. Accsys Technologies is currently generating about -0.08 per unit of risk. 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	Weak
Accuracy	98.44%
Values	Daily Returns

Citigroup  vs.  Accsys Technologies

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.

Accsys Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Accsys Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Citigroup and Accsys Technologies

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

The idea behind Citigroup and Accsys Technologies 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.