Correlation Between Citic Telecom and GREENX METALS
Can any of the company-specific risk be diversified away by investing in both Citic Telecom and GREENX METALS 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 GREENX METALS 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 GREENX METALS LTD, you can compare the effects of market volatilities on Citic Telecom and GREENX METALS 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 GREENX METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Telecom and GREENX METALS.
Diversification Opportunities for Citic Telecom and GREENX METALS
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Citic and GREENX is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Citic Telecom International and GREENX METALS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GREENX METALS LTD 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 GREENX METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GREENX METALS LTD has no effect on the direction of Citic Telecom i.e., Citic Telecom and GREENX METALS go up and down completely randomly.
Pair Corralation between Citic Telecom and GREENX METALS
Assuming the 90 days trading horizon Citic Telecom International is expected to generate 1.64 times more return on investment than GREENX METALS. However, Citic Telecom is 1.64 times more volatile than GREENX METALS LTD. It trades about 0.06 of its potential returns per unit of risk. GREENX METALS LTD is currently generating about 0.01 per unit of risk. If you would invest 8.74 in Citic Telecom International on August 31, 2024 and sell it today you would earn a total of 17.26 from holding Citic Telecom International or generate 197.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
Citic Telecom International vs. GREENX METALS LTD
Performance |
| Timeline |
| Citic Telecom Intern |
| GREENX METALS LTD |
Citic Telecom and GREENX METALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Telecom and GREENX METALS
The main advantage of trading using opposite Citic Telecom and GREENX METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Telecom position performs unexpectedly, GREENX METALS 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 GREENX METALS will offset losses from the drop in GREENX METALS's long position.| Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc |
| GREENX METALS vs. Superior Plus Corp | GREENX METALS vs. NMI Holdings | GREENX METALS vs. Origin Agritech | GREENX METALS vs. SIVERS SEMICONDUCTORS AB |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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