Correlation Between Tibet Huayu and China Citic
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By analyzing existing cross correlation between Tibet Huayu Mining and China Citic Bank, you can compare the effects of market volatilities on Tibet Huayu and China Citic 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 Tibet Huayu with a short position of China Citic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tibet Huayu and China Citic.
Diversification Opportunities for Tibet Huayu and China Citic
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tibet and China is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Tibet Huayu Mining and China Citic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Citic Bank and Tibet Huayu 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 Tibet Huayu Mining are associated (or correlated) with China Citic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Citic Bank has no effect on the direction of Tibet Huayu i.e., Tibet Huayu and China Citic go up and down completely randomly.
Pair Corralation between Tibet Huayu and China Citic
Assuming the 90 days trading horizon Tibet Huayu Mining is expected to generate 1.76 times more return on investment than China Citic. However, Tibet Huayu is 1.76 times more volatile than China Citic Bank. It trades about 0.05 of its potential returns per unit of risk. China Citic Bank is currently generating about 0.05 per unit of risk. If you would invest 867.00 in Tibet Huayu Mining on September 3, 2024 and sell it today you would earn a total of 572.00 from holding Tibet Huayu Mining or generate 65.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tibet Huayu Mining vs. China Citic Bank
Performance |
| Timeline |
| Tibet Huayu Mining |
| China Citic Bank |
Tibet Huayu and China Citic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tibet Huayu and China Citic
The main advantage of trading using opposite Tibet Huayu and China Citic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tibet Huayu position performs unexpectedly, China Citic 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 China Citic will offset losses from the drop in China Citic's long position.| Tibet Huayu vs. Zijin Mining Group | Tibet Huayu vs. Baoshan Iron Steel | Tibet Huayu vs. Rongsheng Petrochemical Co | Tibet Huayu vs. Hoshine Silicon Ind |
| China Citic vs. StarPower Semiconductor | China Citic vs. Integrated Electronic Systems | China Citic vs. GRINM Semiconductor Materials | China Citic vs. Techshine Electronics Co |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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