Correlation Between Black Mammoth and CITIGROUP CDR

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

By analyzing existing cross correlation between Black Mammoth Metals and CITIGROUP CDR, you can compare the effects of market volatilities on Black Mammoth and CITIGROUP CDR 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 Black Mammoth with a short position of CITIGROUP CDR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Black Mammoth and CITIGROUP CDR.

Diversification Opportunities for Black Mammoth and CITIGROUP CDR

0.08

Correlation Coefficient

Black Mammoth  CITIGROUP CDR

Significant diversification

The 3 months correlation between Black and CITIGROUP is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Black Mammoth Metals and CITIGROUP CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITIGROUP CDR and Black Mammoth 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 Black Mammoth Metals are associated (or correlated) with CITIGROUP CDR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CITIGROUP CDR has no effect on the direction of Black Mammoth i.e., Black Mammoth and CITIGROUP CDR go up and down completely randomly.

Pair Corralation between Black Mammoth and CITIGROUP CDR

Assuming the 90 days horizon Black Mammoth is expected to generate 129.56 times less return on investment than CITIGROUP CDR. In addition to that, Black Mammoth is 2.6 times more volatile than CITIGROUP CDR. It trades about 0.0 of its total potential returns per unit of risk. CITIGROUP CDR is currently generating about 0.36 per unit of volatility. If you would invest  2,776  in CITIGROUP CDR on April 23, 2025 and sell it today you would earn a total of  1,114  from holding CITIGROUP CDR or generate 40.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Black Mammoth Metals  vs.  CITIGROUP CDR

Black Mammoth Metals

Risk-Adjusted Performance

Very Weak

Over the last 90 days Black Mammoth Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Black Mammoth is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

CITIGROUP CDR

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in CITIGROUP CDR are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, CITIGROUP CDR exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Black Mammoth and CITIGROUP CDR

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

The idea behind Black Mammoth Metals and CITIGROUP CDR 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.