Correlation Between Dongxing Sec and Citic Guoan
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By analyzing existing cross correlation between Dongxing Sec Co and Citic Guoan Wine, you can compare the effects of market volatilities on Dongxing Sec 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 Dongxing Sec with a short position of Citic Guoan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongxing Sec and Citic Guoan.
Diversification Opportunities for Dongxing Sec and Citic Guoan
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dongxing and Citic is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Dongxing Sec Co 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 Dongxing Sec 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 Dongxing Sec Co 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 Dongxing Sec i.e., Dongxing Sec and Citic Guoan go up and down completely randomly.
Pair Corralation between Dongxing Sec and Citic Guoan
Assuming the 90 days trading horizon Dongxing Sec Co is expected to under-perform the Citic Guoan. In addition to that, Dongxing Sec is 1.19 times more volatile than Citic Guoan Wine. It trades about -0.05 of its total potential returns per unit of risk. Citic Guoan Wine is currently generating about 0.12 per unit of volatility. If you would invest 624.00 in Citic Guoan Wine on September 14, 2024 and sell it today you would earn a total of 30.00 from holding Citic Guoan Wine or generate 4.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongxing Sec Co vs. Citic Guoan Wine
Performance |
| Timeline |
| Dongxing Sec |
| Citic Guoan Wine |
Dongxing Sec and Citic Guoan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongxing Sec and Citic Guoan
The main advantage of trading using opposite Dongxing Sec and Citic Guoan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongxing Sec 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.| Dongxing Sec vs. Shanghai CEO Environmental | Dongxing Sec vs. Juewei Food Co | Dongxing Sec vs. Innovative Medical Management | Dongxing Sec vs. Huaxia Fund Management |
| Citic Guoan vs. China Life Insurance | Citic Guoan vs. Cinda Securities Co | Citic Guoan vs. Piotech Inc A | Citic Guoan vs. Dongxing Sec 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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