Correlation Between CITIC Guoan and Metro Investment
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By analyzing existing cross correlation between CITIC Guoan Information and Metro Investment Development, you can compare the effects of market volatilities on CITIC Guoan and Metro Investment 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 Metro Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIC Guoan and Metro Investment.
Diversification Opportunities for CITIC Guoan and Metro Investment
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CITIC and Metro is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding CITIC Guoan Information and Metro Investment Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Investment Dev 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 Metro Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Investment Dev has no effect on the direction of CITIC Guoan i.e., CITIC Guoan and Metro Investment go up and down completely randomly.
Pair Corralation between CITIC Guoan and Metro Investment
Assuming the 90 days trading horizon CITIC Guoan Information is expected to generate 0.71 times more return on investment than Metro Investment. However, CITIC Guoan Information is 1.41 times less risky than Metro Investment. It trades about 0.07 of its potential returns per unit of risk. Metro Investment Development is currently generating about -0.02 per unit of risk. If you would invest 206.00 in CITIC Guoan Information on September 2, 2024 and sell it today you would earn a total of 145.00 from holding CITIC Guoan Information or generate 70.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITIC Guoan Information vs. Metro Investment Development
Performance |
| Timeline |
| CITIC Guoan Information |
| Metro Investment Dev |
CITIC Guoan and Metro Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITIC Guoan and Metro Investment
The main advantage of trading using opposite CITIC Guoan and Metro Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIC Guoan position performs unexpectedly, Metro Investment 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 Metro Investment will offset losses from the drop in Metro Investment's long position.| CITIC Guoan vs. China Petroleum Chemical | CITIC Guoan vs. PetroChina Co Ltd | CITIC Guoan vs. China State Construction | CITIC Guoan vs. China Railway Group |
| Metro Investment vs. Guangzhou Tinci Materials | Metro Investment vs. Suzhou Xingye Material | Metro Investment vs. King Strong New Material | Metro Investment vs. Jiajia Food Group |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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