Correlation Between Citic Guoan and Longxing Chemical
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By analyzing existing cross correlation between Citic Guoan Wine and Longxing Chemical Stock, you can compare the effects of market volatilities on Citic Guoan and Longxing Chemical 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 Longxing Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Guoan and Longxing Chemical.
Diversification Opportunities for Citic Guoan and Longxing Chemical
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Citic and Longxing is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Citic Guoan Wine and Longxing Chemical Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longxing Chemical Stock 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 Wine are associated (or correlated) with Longxing Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longxing Chemical Stock has no effect on the direction of Citic Guoan i.e., Citic Guoan and Longxing Chemical go up and down completely randomly.
Pair Corralation between Citic Guoan and Longxing Chemical
Assuming the 90 days trading horizon Citic Guoan is expected to generate 1.46 times less return on investment than Longxing Chemical. In addition to that, Citic Guoan is 1.17 times more volatile than Longxing Chemical Stock. It trades about 0.15 of its total potential returns per unit of risk. Longxing Chemical Stock is currently generating about 0.25 per unit of volatility. If you would invest 495.00 in Longxing Chemical Stock on September 5, 2024 and sell it today you would earn a total of 68.00 from holding Longxing Chemical Stock or generate 13.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citic Guoan Wine vs. Longxing Chemical Stock
Performance |
| Timeline |
| Citic Guoan Wine |
| Longxing Chemical Stock |
Citic Guoan and Longxing Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Guoan and Longxing Chemical
The main advantage of trading using opposite Citic Guoan and Longxing Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Guoan position performs unexpectedly, Longxing Chemical 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 Longxing Chemical will offset losses from the drop in Longxing Chemical's long position.| Citic Guoan vs. Chengdu Xingrong Investment | Citic Guoan vs. Zhejiang Construction Investment | Citic Guoan vs. Zhongrun Resources Investment | Citic Guoan vs. Jiangsu Jinling Sports |
| Longxing Chemical vs. Wuhan Yangtze Communication | Longxing Chemical vs. Sinofibers Technology Co | Longxing Chemical vs. Soyea Technology Co | Longxing Chemical vs. Citic Guoan Wine |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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