Correlation Between CITIC Guoan and Kangxin New
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By analyzing existing cross correlation between CITIC Guoan Information and Kangxin New Materials, you can compare the effects of market volatilities on CITIC Guoan and Kangxin New 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 CITIC Guoan with a short position of Kangxin New. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIC Guoan and Kangxin New.
Diversification Opportunities for CITIC Guoan and Kangxin New
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CITIC and Kangxin is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding CITIC Guoan Information and Kangxin New Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kangxin New Materials and CITIC Guoan 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 CITIC Guoan Information are associated (or correlated) with Kangxin New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kangxin New Materials has no effect on the direction of CITIC Guoan i.e., CITIC Guoan and Kangxin New go up and down completely randomly.
Pair Corralation between CITIC Guoan and Kangxin New
Assuming the 90 days trading horizon CITIC Guoan Information is expected to generate 1.56 times more return on investment than Kangxin New. However, CITIC Guoan is 1.56 times more volatile than Kangxin New Materials. It trades about 0.24 of its potential returns per unit of risk. Kangxin New Materials is currently generating about 0.15 per unit of risk. If you would invest 290.00 in CITIC Guoan Information on November 22, 2024 and sell it today you would earn a total of 38.00 from holding CITIC Guoan Information or generate 13.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITIC Guoan Information vs. Kangxin New Materials
Performance |
| Timeline |
| CITIC Guoan Information |
| Kangxin New Materials |
CITIC Guoan and Kangxin New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITIC Guoan and Kangxin New
The main advantage of trading using opposite CITIC Guoan and Kangxin New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIC Guoan position performs unexpectedly, Kangxin New 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 Kangxin New will offset losses from the drop in Kangxin New's long position.| CITIC Guoan vs. GreenTech Environmental Co | CITIC Guoan vs. Guangdong Liantai Environmental | CITIC Guoan vs. Sinocat Environmental Technology | CITIC Guoan vs. Fujian Nanwang Environment |
| Kangxin New vs. China Satellite Communications | Kangxin New vs. BizConf Telecom Co | Kangxin New vs. CICT Mobile Communication | Kangxin New vs. Dhc Software Co |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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