Correlation Between CITIGROUP CDR and Gibson Energy

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

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

Diversification Opportunities for CITIGROUP CDR and Gibson Energy

0.92

Correlation Coefficient

CITIGROUP CDR  Gibson Energy

Almost no diversification

The 3 months correlation between CITIGROUP and Gibson is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding CITIGROUP CDR and Gibson Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gibson Energy and CITIGROUP CDR 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 CDR are associated (or correlated) with Gibson Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gibson Energy has no effect on the direction of CITIGROUP CDR i.e., CITIGROUP CDR and Gibson Energy go up and down completely randomly.

Pair Corralation between CITIGROUP CDR and Gibson Energy

Assuming the 90 days trading horizon CITIGROUP CDR is expected to generate 1.7 times more return on investment than Gibson Energy. However, CITIGROUP CDR is 1.7 times more volatile than Gibson Energy. It trades about 0.39 of its potential returns per unit of risk. Gibson Energy is currently generating about 0.3 per unit of risk. If you would invest  2,699  in CITIGROUP CDR on April 22, 2025 and sell it today you would earn a total of  1,217  from holding CITIGROUP CDR or generate 45.09% return on investment over 90 days.

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

CITIGROUP CDR  vs.  Gibson Energy

CITIGROUP CDR

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in CITIGROUP CDR are ranked lower than 30 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating technical and fundamental indicators, CITIGROUP CDR exhibited solid returns over the last few months and may actually be approaching a breakup point.

Gibson Energy

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Gibson Energy are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating forward indicators, Gibson Energy displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CITIGROUP CDR and Gibson Energy

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

The idea behind CITIGROUP CDR and Gibson Energy 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.