Correlation Between Citigroup and Thailand Prime

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

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

Diversification Opportunities for Citigroup and Thailand Prime

0.29

Correlation Coefficient

Citigroup  Thailand Prime

Modest diversification

The 3 months correlation between Citigroup and Thailand is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and Thailand Prime Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thailand Prime Property 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 Thailand Prime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thailand Prime Property has no effect on the direction of Citigroup i.e., Citigroup and Thailand Prime go up and down completely randomly.

Pair Corralation between Citigroup and Thailand Prime

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.98 times more return on investment than Thailand Prime. However, Citigroup is 1.02 times less risky than Thailand Prime. It trades about 0.13 of its potential returns per unit of risk. Thailand Prime Property is currently generating about 0.04 per unit of risk. If you would invest  6,205  in Citigroup on September 28, 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 Together
Strength	Very Weak
Accuracy	96.77%
Values	Daily Returns

Citigroup  vs.  Thailand Prime Property

Citigroup

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 9 (%) 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.

Thailand Prime Property

Risk-Adjusted Performance

2 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Thailand Prime Property are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Thailand Prime 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 Thailand Prime

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

The idea behind Citigroup and Thailand Prime Property 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.