Correlation Between CITIC Telecom and QURATE RETAIL
Can any of the company-specific risk be diversified away by investing in both CITIC Telecom and QURATE RETAIL at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining CITIC Telecom and QURATE RETAIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITIC Telecom International and QURATE RETAIL INC, you can compare the effects of market volatilities on CITIC Telecom and QURATE RETAIL 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 Telecom with a short position of QURATE RETAIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIC Telecom and QURATE RETAIL.
Diversification Opportunities for CITIC Telecom and QURATE RETAIL
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CITIC and QURATE is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding CITIC Telecom International and QURATE RETAIL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QURATE RETAIL INC and CITIC Telecom 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 Telecom International are associated (or correlated) with QURATE RETAIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QURATE RETAIL INC has no effect on the direction of CITIC Telecom i.e., CITIC Telecom and QURATE RETAIL go up and down completely randomly.
Pair Corralation between CITIC Telecom and QURATE RETAIL
Assuming the 90 days horizon CITIC Telecom International is expected to generate 0.56 times more return on investment than QURATE RETAIL. However, CITIC Telecom International is 1.8 times less risky than QURATE RETAIL. It trades about -0.01 of its potential returns per unit of risk. QURATE RETAIL INC is currently generating about -0.05 per unit of risk. If you would invest 27.00 in CITIC Telecom International on October 12, 2024 and sell it today you would lose (1.00) from holding CITIC Telecom International or give up 3.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.5% |
| Values | Daily Returns |
CITIC Telecom International vs. QURATE RETAIL INC
Performance |
| Timeline |
| CITIC Telecom Intern |
| QURATE RETAIL INC |
CITIC Telecom and QURATE RETAIL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITIC Telecom and QURATE RETAIL
The main advantage of trading using opposite CITIC Telecom and QURATE RETAIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIC Telecom position performs unexpectedly, QURATE RETAIL 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 QURATE RETAIL will offset losses from the drop in QURATE RETAIL's long position.| CITIC Telecom vs. Liberty Broadband | CITIC Telecom vs. Casio Computer CoLtd | CITIC Telecom vs. X FAB Silicon Foundries | CITIC Telecom vs. FANDIFI TECHNOLOGY P |
| QURATE RETAIL vs. Eurasia Mining Plc | QURATE RETAIL vs. CITIC Telecom International | QURATE RETAIL vs. Highlight Communications AG | QURATE RETAIL vs. Chengdu PUTIAN Telecommunications |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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