Correlation Between Citigroup and WisdomTree Issuer

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Citigroup and WisdomTree Issuer 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 WisdomTree Issuer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and WisdomTree Issuer ICAV, you can compare the effects of market volatilities on Citigroup and WisdomTree Issuer 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 WisdomTree Issuer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and WisdomTree Issuer.

Diversification Opportunities for Citigroup and WisdomTree Issuer

0.77
  Correlation Coefficient

Poor diversification

The 3 months correlation between Citigroup and WisdomTree is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup and WisdomTree Issuer ICAV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Issuer ICAV 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 WisdomTree Issuer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Issuer ICAV has no effect on the direction of Citigroup i.e., Citigroup and WisdomTree Issuer go up and down completely randomly.

Pair Corralation between Citigroup and WisdomTree Issuer

Taking into account the 90-day investment horizon Citigroup is expected to generate 1.84 times more return on investment than WisdomTree Issuer. However, Citigroup is 1.84 times more volatile than WisdomTree Issuer ICAV. It trades about 0.14 of its potential returns per unit of risk. WisdomTree Issuer ICAV is currently generating about 0.04 per unit of risk. If you would invest  6,117  in Citigroup on September 26, 2024 and sell it today you would earn a total of  983.00  from holding Citigroup or generate 16.07% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy98.44%
ValuesDaily Returns

Citigroup  vs.  WisdomTree Issuer ICAV

 Performance 
       Timeline  
Citigroup 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 10 (%) 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.
WisdomTree Issuer ICAV 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in WisdomTree Issuer ICAV are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable forward indicators, WisdomTree Issuer is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Citigroup and WisdomTree Issuer Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Citigroup and WisdomTree Issuer

The main advantage of trading using opposite Citigroup and WisdomTree Issuer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup position performs unexpectedly, WisdomTree Issuer 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 WisdomTree Issuer will offset losses from the drop in WisdomTree Issuer's long position.
The idea behind Citigroup and WisdomTree Issuer ICAV 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

Other Complementary Tools

Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
CEOs Directory
Screen CEOs from public companies around the world
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume