Correlation Between CHINA EDUCATION and Citic Telecom
Can any of the company-specific risk be diversified away by investing in both CHINA EDUCATION 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 CHINA EDUCATION and Citic Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHINA EDUCATION GROUP and Citic Telecom International, you can compare the effects of market volatilities on CHINA EDUCATION 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 CHINA EDUCATION with a short position of Citic Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHINA EDUCATION and Citic Telecom.
Diversification Opportunities for CHINA EDUCATION and Citic Telecom
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CHINA and Citic is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding CHINA EDUCATION GROUP 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 CHINA EDUCATION 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 CHINA EDUCATION GROUP 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 CHINA EDUCATION i.e., CHINA EDUCATION and Citic Telecom go up and down completely randomly.
Pair Corralation between CHINA EDUCATION and Citic Telecom
Assuming the 90 days horizon CHINA EDUCATION GROUP is expected to under-perform the Citic Telecom. In addition to that, CHINA EDUCATION is 2.02 times more volatile than Citic Telecom International. It trades about -0.29 of its total potential returns per unit of risk. Citic Telecom International is currently generating about 0.01 per unit of volatility. If you would invest 26.00 in Citic Telecom International on September 2, 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 | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CHINA EDUCATION GROUP vs. Citic Telecom International
Performance |
| Timeline |
| CHINA EDUCATION GROUP |
| Citic Telecom Intern |
CHINA EDUCATION and Citic Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHINA EDUCATION and Citic Telecom
The main advantage of trading using opposite CHINA EDUCATION and Citic Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHINA EDUCATION 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.| CHINA EDUCATION vs. DICKS Sporting Goods | CHINA EDUCATION vs. NTG Nordic Transport | CHINA EDUCATION vs. Fukuyama Transporting Co | CHINA EDUCATION vs. Sporttotal AG |
| Citic Telecom vs. X Fab Silicon | Citic Telecom vs. Silicon Motion Technology | Citic Telecom vs. MACOM Technology Solutions | Citic Telecom vs. Micron Technology |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |