Correlation Between China Citic and BTG Hotels
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By analyzing existing cross correlation between China Citic Bank and BTG Hotels Group, you can compare the effects of market volatilities on China Citic and BTG Hotels 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 China Citic with a short position of BTG Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Citic and BTG Hotels.
Diversification Opportunities for China Citic and BTG Hotels
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and BTG is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding China Citic Bank and BTG Hotels Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTG Hotels Group and China Citic 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 China Citic Bank are associated (or correlated) with BTG Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTG Hotels Group has no effect on the direction of China Citic i.e., China Citic and BTG Hotels go up and down completely randomly.
Pair Corralation between China Citic and BTG Hotels
Assuming the 90 days trading horizon China Citic Bank is expected to under-perform the BTG Hotels. But the stock apears to be less risky and, when comparing its historical volatility, China Citic Bank is 1.31 times less risky than BTG Hotels. The stock trades about -0.08 of its potential returns per unit of risk. The BTG Hotels Group is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,391 in BTG Hotels Group on August 25, 2024 and sell it today you would lose (5.00) from holding BTG Hotels Group or give up 0.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Citic Bank vs. BTG Hotels Group
Performance |
| Timeline |
| China Citic Bank |
| BTG Hotels Group |
China Citic and BTG Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Citic and BTG Hotels
The main advantage of trading using opposite China Citic and BTG Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Citic position performs unexpectedly, BTG Hotels 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 BTG Hotels will offset losses from the drop in BTG Hotels' long position.| China Citic vs. Bomin Electronics Co | China Citic vs. CIMC Vehicles Co | China Citic vs. Unigroup Guoxin Microelectronics | China Citic vs. Xiangyang Automobile Bearing |
| BTG Hotels vs. Biwin Storage Technology | BTG Hotels vs. PetroChina Co Ltd | BTG Hotels vs. Industrial and Commercial | BTG Hotels vs. China Construction Bank |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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