Correlation Between Citic Telecom and Immofinanz
Can any of the company-specific risk be diversified away by investing in both Citic Telecom and Immofinanz 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 Immofinanz 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 Immofinanz AG, you can compare the effects of market volatilities on Citic Telecom and Immofinanz 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 Immofinanz. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Telecom and Immofinanz.
Diversification Opportunities for Citic Telecom and Immofinanz
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citic and Immofinanz is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Citic Telecom International and Immofinanz AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immofinanz AG 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 Immofinanz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immofinanz AG has no effect on the direction of Citic Telecom i.e., Citic Telecom and Immofinanz go up and down completely randomly.
Pair Corralation between Citic Telecom and Immofinanz
Assuming the 90 days trading horizon Citic Telecom International is expected to generate 1.48 times more return on investment than Immofinanz. However, Citic Telecom is 1.48 times more volatile than Immofinanz AG. It trades about 0.04 of its potential returns per unit of risk. Immofinanz AG is currently generating about -0.08 per unit of risk. If you would invest 23.00 in Citic Telecom International on September 3, 2024 and sell it today you would earn a total of 3.00 from holding Citic Telecom International or generate 13.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citic Telecom International vs. Immofinanz AG
Performance |
| Timeline |
| Citic Telecom Intern |
| Immofinanz AG |
Citic Telecom and Immofinanz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Telecom and Immofinanz
The main advantage of trading using opposite Citic Telecom and Immofinanz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Telecom position performs unexpectedly, Immofinanz 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 Immofinanz will offset losses from the drop in Immofinanz's long position.| Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc |
| Immofinanz vs. Iridium Communications | Immofinanz vs. Mobilezone Holding AG | Immofinanz vs. Singapore Telecommunications Limited | Immofinanz vs. Citic Telecom International |
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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