Correlation Between Citigroup and MacKenzie Realty

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

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

Diversification Opportunities for Citigroup and MacKenzie Realty

0.28

Correlation Coefficient

Citigroup  MacKenzie Realty

Modest diversification

The 3 months correlation between Citigroup and MacKenzie is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and MacKenzie Realty Capital, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MacKenzie Realty Capital, 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 MacKenzie Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MacKenzie Realty Capital, has no effect on the direction of Citigroup i.e., Citigroup and MacKenzie Realty go up and down completely randomly.

Pair Corralation between Citigroup and MacKenzie Realty

Taking into account the 90-day investment horizon Citigroup is expected to generate 68.3 times less return on investment than MacKenzie Realty. But when comparing it to its historical volatility, Citigroup is 4.21 times less risky than MacKenzie Realty. It trades about 0.02 of its potential returns per unit of risk. MacKenzie Realty Capital, is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest  308.00  in MacKenzie Realty Capital, on September 25, 2024 and sell it today you would earn a total of  112.00  from holding MacKenzie Realty Capital, or generate 36.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Citigroup  vs.  MacKenzie Realty Capital,

Citigroup

Risk-Adjusted Performance

12 of 100

OK

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 uncertain fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.

MacKenzie Realty Capital,

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MacKenzie Realty Capital, are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, MacKenzie Realty reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Citigroup and MacKenzie Realty

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

The idea behind Citigroup and MacKenzie Realty Capital, 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.