Correlation Between Citigroup and PyroGenesis Canada
Can any of the company-specific risk be diversified away by investing in both Citigroup and PyroGenesis Canada 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 PyroGenesis Canada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and PyroGenesis Canada, you can compare the effects of market volatilities on Citigroup and PyroGenesis Canada 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 PyroGenesis Canada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and PyroGenesis Canada.
Diversification Opportunities for Citigroup and PyroGenesis Canada
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citigroup and PyroGenesis is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and PyroGenesis Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PyroGenesis Canada 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 PyroGenesis Canada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PyroGenesis Canada has no effect on the direction of Citigroup i.e., Citigroup and PyroGenesis Canada go up and down completely randomly.
Pair Corralation between Citigroup and PyroGenesis Canada
Taking into account the 90-day investment horizon Citigroup is expected to generate 0.48 times more return on investment than PyroGenesis Canada. However, Citigroup is 2.1 times less risky than PyroGenesis Canada. It trades about 0.13 of its potential returns per unit of risk. PyroGenesis Canada is currently generating about -0.17 per unit of risk. If you would invest 6,205 in Citigroup on September 29, 2024 and sell it today you would earn a total of 895.00 from holding Citigroup or generate 14.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 98.41% |
Values | Daily Returns |
Citigroup vs. PyroGenesis Canada
Performance |
Timeline |
Citigroup |
PyroGenesis Canada |
Citigroup and PyroGenesis Canada Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Citigroup and PyroGenesis Canada
The main advantage of trading using opposite Citigroup and PyroGenesis Canada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, PyroGenesis Canada 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 PyroGenesis Canada will offset losses from the drop in PyroGenesis Canada's long position.The idea behind Citigroup and PyroGenesis Canada 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.PyroGenesis Canada vs. Microsoft Corp CDR | PyroGenesis Canada vs. Apple Inc CDR | PyroGenesis Canada vs. Alphabet Inc CDR | PyroGenesis Canada vs. Amazon CDR |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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