Correlation Between Citigroup and Junee Limited

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

Diversification Opportunities for Citigroup and Junee Limited

-0.32
  Correlation Coefficient

Very good diversification

The 3 months correlation between Citigroup and Junee is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Junee Limited Ordinary in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Junee Limited Ordinary 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 Junee Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Junee Limited Ordinary has no effect on the direction of Citigroup i.e., Citigroup and Junee Limited go up and down completely randomly.

Pair Corralation between Citigroup and Junee Limited

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.21 times more return on investment than Junee Limited. However, Citigroup is 4.66 times less risky than Junee Limited. It trades about 0.28 of its potential returns per unit of risk. Junee Limited Ordinary is currently generating about -0.29 per unit of risk. If you would invest  6,863  in Citigroup on September 9, 2024 and sell it today you would earn a total of  352.00  from holding Citigroup or generate 5.13% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Citigroup  vs.  Junee Limited Ordinary

 Performance 
       Timeline  
Citigroup 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 13 (%) 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.
Junee Limited Ordinary 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Junee Limited Ordinary has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Etf's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the fund shareholders.

Citigroup and Junee Limited Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Citigroup and Junee Limited

The main advantage of trading using opposite Citigroup and Junee Limited positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, Junee Limited 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 Junee Limited will offset losses from the drop in Junee Limited's long position.
The idea behind Citigroup and Junee Limited Ordinary 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.
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 the Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.

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