Correlation Between Elite Color and Citic Guoan
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By analyzing existing cross correlation between Elite Color Environmental and Citic Guoan Wine, you can compare the effects of market volatilities on Elite Color and Citic Guoan 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 Elite Color with a short position of Citic Guoan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elite Color and Citic Guoan.
Diversification Opportunities for Elite Color and Citic Guoan
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Elite and Citic is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Elite Color Environmental and Citic Guoan Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citic Guoan Wine and Elite Color 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 Elite Color Environmental are associated (or correlated) with Citic Guoan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citic Guoan Wine has no effect on the direction of Elite Color i.e., Elite Color and Citic Guoan go up and down completely randomly.
Pair Corralation between Elite Color and Citic Guoan
Assuming the 90 days trading horizon Elite Color Environmental is expected to generate 0.95 times more return on investment than Citic Guoan. However, Elite Color Environmental is 1.05 times less risky than Citic Guoan. It trades about 0.06 of its potential returns per unit of risk. Citic Guoan Wine is currently generating about -0.11 per unit of risk. If you would invest 616.00 in Elite Color Environmental on November 1, 2024 and sell it today you would earn a total of 13.00 from holding Elite Color Environmental or generate 2.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elite Color Environmental vs. Citic Guoan Wine
Performance |
| Timeline |
| Elite Color Environmental |
| Citic Guoan Wine |
Elite Color and Citic Guoan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elite Color and Citic Guoan
The main advantage of trading using opposite Elite Color and Citic Guoan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elite Color position performs unexpectedly, Citic Guoan 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 Citic Guoan will offset losses from the drop in Citic Guoan's long position.| Elite Color vs. Ningxia Younglight Chemicals | Elite Color vs. Jiamei Food Packaging | Elite Color vs. Do Fluoride Chemicals Co | Elite Color vs. Yankershop Food Co |
| Citic Guoan vs. Harvest Fund Management | Citic Guoan vs. Cicc Fund Management | Citic Guoan vs. China Asset Management | Citic Guoan vs. Innovative Medical Management |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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