Correlation Between Citigroup and Msif Global

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

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

Diversification Opportunities for Citigroup and Msif Global

0.0

Correlation Coefficient

Citigroup  Msif Global

Pay attention - limited upside

The 3 months correlation between Citigroup and Msif is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Msif Global Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Msif Global Real 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 Msif Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Msif Global Real has no effect on the direction of Citigroup i.e., Citigroup and Msif Global go up and down completely randomly.

Pair Corralation between Citigroup and Msif Global

Taking into account the 90-day investment horizon Citigroup is expected to generate 3.83 times more return on investment than Msif Global. However, Citigroup is 3.83 times more volatile than Msif Global Real. It trades about 0.16 of its potential returns per unit of risk. Msif Global Real is currently generating about -0.06 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	Flat
Strength	Insignificant
Accuracy	77.78%
Values	Daily Returns

Citigroup  vs.  Msif Global Real

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.

Msif Global Real

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Msif Global Real has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Msif Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Citigroup and Msif Global

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

The idea behind Citigroup and Msif Global Real 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.