Correlation Between Boston Beer and CITIC Telecom
Can any of the company-specific risk be diversified away by investing in both Boston Beer and CITIC Telecom 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 Boston Beer and CITIC Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Boston Beer and CITIC Telecom International, you can compare the effects of market volatilities on Boston Beer and CITIC Telecom 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 Boston Beer with a short position of CITIC Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Beer and CITIC Telecom.
Diversification Opportunities for Boston Beer and CITIC Telecom
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Boston and CITIC is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding The Boston Beer and CITIC Telecom International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITIC Telecom Intern and Boston Beer 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 The Boston Beer are associated (or correlated) with CITIC Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CITIC Telecom Intern has no effect on the direction of Boston Beer i.e., Boston Beer and CITIC Telecom go up and down completely randomly.
Pair Corralation between Boston Beer and CITIC Telecom
Assuming the 90 days trading horizon Boston Beer is expected to generate 40.06 times less return on investment than CITIC Telecom. But when comparing it to its historical volatility, The Boston Beer is 3.56 times less risky than CITIC Telecom. It trades about 0.01 of its potential returns per unit of risk. CITIC Telecom International is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3.91 in CITIC Telecom International on September 13, 2024 and sell it today you would earn a total of 25.09 from holding CITIC Telecom International or generate 641.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Boston Beer vs. CITIC Telecom International
Performance |
| Timeline |
| Boston Beer |
| CITIC Telecom Intern |
Boston Beer and CITIC Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Beer and CITIC Telecom
The main advantage of trading using opposite Boston Beer and CITIC Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Beer position performs unexpectedly, CITIC Telecom 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 CITIC Telecom will offset losses from the drop in CITIC Telecom's long position.| Boston Beer vs. Gol Intelligent Airlines | Boston Beer vs. Sunny Optical Technology | Boston Beer vs. DXC Technology Co | Boston Beer vs. United Airlines Holdings |
| CITIC Telecom vs. Superior Plus Corp | CITIC Telecom vs. SIVERS SEMICONDUCTORS AB | CITIC Telecom vs. Norsk Hydro ASA | CITIC Telecom vs. Reliance Steel Aluminum |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |