Correlation Between Citic Telecom and Seabridge Gold
Can any of the company-specific risk be diversified away by investing in both Citic Telecom and Seabridge Gold 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 Seabridge Gold 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 Seabridge Gold, you can compare the effects of market volatilities on Citic Telecom and Seabridge Gold 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 Seabridge Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Telecom and Seabridge Gold.
Diversification Opportunities for Citic Telecom and Seabridge Gold
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citic and Seabridge is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Citic Telecom International and Seabridge Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seabridge Gold 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 Seabridge Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seabridge Gold has no effect on the direction of Citic Telecom i.e., Citic Telecom and Seabridge Gold go up and down completely randomly.
Pair Corralation between Citic Telecom and Seabridge Gold
Assuming the 90 days trading horizon Citic Telecom International is expected to generate 1.06 times more return on investment than Seabridge Gold. However, Citic Telecom is 1.06 times more volatile than Seabridge Gold. It trades about 0.09 of its potential returns per unit of risk. Seabridge Gold is currently generating about -0.22 per unit of risk. If you would invest 26.00 in Citic Telecom International on September 13, 2024 and sell it today you would earn a total of 1.00 from holding Citic Telecom International or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Citic Telecom International vs. Seabridge Gold
Performance |
| Timeline |
| Citic Telecom Intern |
| Seabridge Gold |
Citic Telecom and Seabridge Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citic Telecom and Seabridge Gold
The main advantage of trading using opposite Citic Telecom and Seabridge Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Telecom position performs unexpectedly, Seabridge Gold 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 Seabridge Gold will offset losses from the drop in Seabridge Gold's long position.| Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc | Citic Telecom vs. Apple Inc |
| Seabridge Gold vs. Computershare Limited | Seabridge Gold vs. Spirent Communications plc | Seabridge Gold vs. SCOTT TECHNOLOGY | Seabridge Gold vs. Computer And Technologies |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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