Correlation Between Citic Telecom and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both Citic Telecom and Origin Agritech 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 Origin Agritech 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 Origin Agritech, you can compare the effects of market volatilities on Citic Telecom and Origin Agritech 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 Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Telecom and Origin Agritech.
Diversification Opportunities for Citic Telecom and Origin Agritech
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Citic and Origin is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Citic Telecom International and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech 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 Origin Agritech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Agritech has no effect on the direction of Citic Telecom i.e., Citic Telecom and Origin Agritech go up and down completely randomly.
Pair Corralation between Citic Telecom and Origin Agritech
Assuming the 90 days trading horizon Citic Telecom International is expected to generate 1.24 times more return on investment than Origin Agritech. However, Citic Telecom is 1.24 times more volatile than Origin Agritech. It trades about 0.07 of its potential returns per unit of risk. Origin Agritech is currently generating about -0.01 per unit of risk. If you would invest 3.96 in Citic Telecom International on September 3, 2024 and sell it today you would earn a total of 22.04 from holding Citic Telecom International or generate 556.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citic Telecom International vs. Origin Agritech
Performance |
| Timeline |
| Citic Telecom Intern |
| Origin Agritech |
Citic Telecom and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Telecom and Origin Agritech
The main advantage of trading using opposite Citic Telecom and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Telecom position performs unexpectedly, Origin Agritech 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 Origin Agritech will offset losses from the drop in Origin Agritech's long position.| Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc |
| Origin Agritech vs. Gamma Communications plc | Origin Agritech vs. Chunghwa Telecom Co | Origin Agritech vs. Citic Telecom International | Origin Agritech vs. Ribbon Communications |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |