Correlation Between Citic Telecom and Superior Plus
Can any of the company-specific risk be diversified away by investing in both Citic Telecom and Superior Plus 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 Superior Plus 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 Superior Plus Corp, you can compare the effects of market volatilities on Citic Telecom and Superior Plus 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 Superior Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Telecom and Superior Plus.
Diversification Opportunities for Citic Telecom and Superior Plus
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citic and Superior is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Citic Telecom International and Superior Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Plus Corp 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 Superior Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Plus Corp has no effect on the direction of Citic Telecom i.e., Citic Telecom and Superior Plus go up and down completely randomly.
Pair Corralation between Citic Telecom and Superior Plus
Assuming the 90 days trading horizon Citic Telecom is expected to generate 1.29 times less return on investment than Superior Plus. But when comparing it to its historical volatility, Citic Telecom International is 2.06 times less risky than Superior Plus. It trades about 0.08 of its potential returns per unit of risk. Superior Plus Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 428.00 in Superior Plus Corp on September 5, 2024 and sell it today you would earn a total of 12.00 from holding Superior Plus Corp or generate 2.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Citic Telecom International vs. Superior Plus Corp
Performance |
| Timeline |
| Citic Telecom Intern |
| Superior Plus Corp |
Citic Telecom and Superior Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Telecom and Superior Plus
The main advantage of trading using opposite Citic Telecom and Superior Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Telecom position performs unexpectedly, Superior Plus 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 Superior Plus will offset losses from the drop in Superior Plus' long position.| Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc |
| Superior Plus vs. Mobilezone Holding AG | Superior Plus vs. Citic Telecom International | Superior Plus vs. Tower One Wireless | Superior Plus 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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