Correlation Between Citic Telecom and Collins Foods
Can any of the company-specific risk be diversified away by investing in both Citic Telecom and Collins Foods 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 Collins Foods 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 Collins Foods Limited, you can compare the effects of market volatilities on Citic Telecom and Collins Foods 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 Collins Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Telecom and Collins Foods.
Diversification Opportunities for Citic Telecom and Collins Foods
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citic and Collins is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Citic Telecom International and Collins Foods Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Collins Foods Limited 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 Collins Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Collins Foods Limited has no effect on the direction of Citic Telecom i.e., Citic Telecom and Collins Foods go up and down completely randomly.
Pair Corralation between Citic Telecom and Collins Foods
Assuming the 90 days trading horizon Citic Telecom International is expected to under-perform the Collins Foods. In addition to that, Citic Telecom is 2.28 times more volatile than Collins Foods Limited. It trades about -0.11 of its total potential returns per unit of risk. Collins Foods Limited is currently generating about 0.01 per unit of volatility. If you would invest 440.00 in Collins Foods Limited on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Collins Foods Limited or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citic Telecom International vs. Collins Foods Limited
Performance |
| Timeline |
| Citic Telecom Intern |
| Collins Foods Limited |
Citic Telecom and Collins Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Telecom and Collins Foods
The main advantage of trading using opposite Citic Telecom and Collins Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Telecom position performs unexpectedly, Collins Foods 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 Collins Foods will offset losses from the drop in Collins Foods' long position.| Citic Telecom vs. ITALIAN WINE BRANDS | Citic Telecom vs. Firan Technology Group | Citic Telecom vs. PKSHA TECHNOLOGY INC | Citic Telecom vs. PLAYTIKA HOLDING DL 01 |
| Collins Foods vs. Cass Information Systems | Collins Foods vs. Automatic Data Processing | Collins Foods vs. Northern Data AG | Collins Foods vs. China Datang |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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