Correlation Between CITIGROUP CDR and Alphabet

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

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

Diversification Opportunities for CITIGROUP CDR and Alphabet

0.81

Correlation Coefficient

CITIGROUP CDR  Alphabet

Very poor diversification

The 3 months correlation between CITIGROUP and Alphabet is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding CITIGROUP CDR and Alphabet Inc CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alphabet CDR 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 Alphabet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alphabet CDR has no effect on the direction of CITIGROUP CDR i.e., CITIGROUP CDR and Alphabet go up and down completely randomly.

Pair Corralation between CITIGROUP CDR and Alphabet

Assuming the 90 days trading horizon CITIGROUP CDR is expected to generate 1.04 times more return on investment than Alphabet. However, CITIGROUP CDR is 1.04 times more volatile than Alphabet Inc CDR. It trades about 0.05 of its potential returns per unit of risk. Alphabet Inc CDR is currently generating about 0.0 per unit of risk. If you would invest  3,109  in CITIGROUP CDR on March 24, 2025 and sell it today you would earn a total of  189.00  from holding CITIGROUP CDR or generate 6.08% return on investment over 90 days.

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

CITIGROUP CDR  vs.  Alphabet Inc CDR

CITIGROUP CDR

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in CITIGROUP CDR are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating technical and fundamental indicators, CITIGROUP CDR may actually be approaching a critical reversion point that can send shares even higher in July 2025.

Alphabet CDR

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alphabet Inc CDR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Alphabet is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with CITIGROUP CDR and Alphabet

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

The idea behind CITIGROUP CDR and Alphabet Inc 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 Commodity Directory module to find actively traded commodities issued by global exchanges.