Correlation Between Citic Telecom and Grand Canyon
Can any of the company-specific risk be diversified away by investing in both Citic Telecom and Grand Canyon 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 Grand Canyon 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 Grand Canyon Education, you can compare the effects of market volatilities on Citic Telecom and Grand Canyon 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 Grand Canyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Telecom and Grand Canyon.
Diversification Opportunities for Citic Telecom and Grand Canyon
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Citic and Grand is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Citic Telecom International and Grand Canyon Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Canyon Education 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 Grand Canyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Canyon Education has no effect on the direction of Citic Telecom i.e., Citic Telecom and Grand Canyon go up and down completely randomly.
Pair Corralation between Citic Telecom and Grand Canyon
Assuming the 90 days trading horizon Citic Telecom International is expected to generate 1.37 times more return on investment than Grand Canyon. However, Citic Telecom is 1.37 times more volatile than Grand Canyon Education. It trades about 0.01 of its potential returns per unit of risk. Grand Canyon Education is currently generating about -0.08 per unit of risk. If you would invest 27.00 in Citic Telecom International on October 14, 2024 and sell it today you would earn a total of 0.00 from holding Citic Telecom International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citic Telecom International vs. Grand Canyon Education
Performance |
| Timeline |
| Citic Telecom Intern |
| Grand Canyon Education |
Citic Telecom and Grand Canyon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Telecom and Grand Canyon
The main advantage of trading using opposite Citic Telecom and Grand Canyon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Telecom position performs unexpectedly, Grand Canyon 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 Grand Canyon will offset losses from the drop in Grand Canyon's long position.| Citic Telecom vs. MARKET VECTR RETAIL | Citic Telecom vs. CANON MARKETING JP | Citic Telecom vs. Apollo Investment Corp | Citic Telecom vs. TRADEGATE |
| Grand Canyon vs. Citic Telecom International | Grand Canyon vs. ACCSYS TECHPLC EO | Grand Canyon vs. Kingdee International Software | Grand Canyon vs. Addtech 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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