Correlation Between Citic Guoan and Shenzhen Kexin
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By analyzing existing cross correlation between Citic Guoan Wine and Shenzhen Kexin Communication, you can compare the effects of market volatilities on Citic Guoan and Shenzhen Kexin 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 Shenzhen Kexin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Guoan and Shenzhen Kexin.
Diversification Opportunities for Citic Guoan and Shenzhen Kexin
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Citic and Shenzhen is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Citic Guoan Wine and Shenzhen Kexin Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Kexin Commu 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 Shenzhen Kexin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Kexin Commu has no effect on the direction of Citic Guoan i.e., Citic Guoan and Shenzhen Kexin go up and down completely randomly.
Pair Corralation between Citic Guoan and Shenzhen Kexin
Assuming the 90 days trading horizon Citic Guoan is expected to generate 1.49 times less return on investment than Shenzhen Kexin. But when comparing it to its historical volatility, Citic Guoan Wine is 1.16 times less risky than Shenzhen Kexin. It trades about 0.05 of its potential returns per unit of risk. Shenzhen Kexin Communication is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,075 in Shenzhen Kexin Communication on September 1, 2024 and sell it today you would earn a total of 286.00 from holding Shenzhen Kexin Communication or generate 26.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citic Guoan Wine vs. Shenzhen Kexin Communication
Performance |
| Timeline |
| Citic Guoan Wine |
| Shenzhen Kexin Commu |
Citic Guoan and Shenzhen Kexin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Guoan and Shenzhen Kexin
The main advantage of trading using opposite Citic Guoan and Shenzhen Kexin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Guoan position performs unexpectedly, Shenzhen Kexin 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 Shenzhen Kexin will offset losses from the drop in Shenzhen Kexin's long position.| Citic Guoan vs. Xinjiang Baodi Mining | Citic Guoan vs. Minmetals Capital Co | Citic Guoan vs. Lutian Machinery Co | Citic Guoan vs. Shanghai Rightongene Biotechnology |
| Shenzhen Kexin vs. Industrial and Commercial | Shenzhen Kexin vs. Kweichow Moutai Co | Shenzhen Kexin vs. Agricultural Bank of | Shenzhen Kexin vs. China Mobile Limited |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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