Correlation Between Citic Guoan and Changjiang Jinggong
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By analyzing existing cross correlation between Citic Guoan Wine and Changjiang Jinggong Steel, you can compare the effects of market volatilities on Citic Guoan and Changjiang Jinggong 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 Changjiang Jinggong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Guoan and Changjiang Jinggong.
Diversification Opportunities for Citic Guoan and Changjiang Jinggong
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Citic and Changjiang is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Citic Guoan Wine and Changjiang Jinggong Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changjiang Jinggong Steel 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 Changjiang Jinggong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changjiang Jinggong Steel has no effect on the direction of Citic Guoan i.e., Citic Guoan and Changjiang Jinggong go up and down completely randomly.
Pair Corralation between Citic Guoan and Changjiang Jinggong
Assuming the 90 days trading horizon Citic Guoan Wine is expected to generate 1.64 times more return on investment than Changjiang Jinggong. However, Citic Guoan is 1.64 times more volatile than Changjiang Jinggong Steel. It trades about -0.01 of its potential returns per unit of risk. Changjiang Jinggong Steel is currently generating about -0.03 per unit of risk. If you would invest 753.00 in Citic Guoan Wine on August 30, 2024 and sell it today you would lose (142.00) from holding Citic Guoan Wine or give up 18.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citic Guoan Wine vs. Changjiang Jinggong Steel
Performance |
| Timeline |
| Citic Guoan Wine |
| Changjiang Jinggong Steel |
Citic Guoan and Changjiang Jinggong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Guoan and Changjiang Jinggong
The main advantage of trading using opposite Citic Guoan and Changjiang Jinggong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Guoan position performs unexpectedly, Changjiang Jinggong 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 Changjiang Jinggong will offset losses from the drop in Changjiang Jinggong's long position.| Citic Guoan vs. Agricultural Bank of | Citic Guoan vs. Industrial and Commercial | Citic Guoan vs. Bank of China | Citic Guoan vs. China Construction Bank |
| Changjiang Jinggong vs. Shenzhen MTC Co | Changjiang Jinggong vs. Ming Yang Smart | Changjiang Jinggong vs. Changzhou Almaden Co | Changjiang Jinggong vs. 159681 |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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