Correlation Between CITIC and Grupo Carso
Can any of the company-specific risk be diversified away by investing in both CITIC and Grupo Carso 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 and Grupo Carso into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITIC Limited and Grupo Carso SAB, you can compare the effects of market volatilities on CITIC and Grupo Carso 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 with a short position of Grupo Carso. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIC and Grupo Carso.
Diversification Opportunities for CITIC and Grupo Carso
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CITIC and Grupo is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding CITIC Limited and Grupo Carso SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Carso SAB and CITIC 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 Limited are associated (or correlated) with Grupo Carso. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Carso SAB has no effect on the direction of CITIC i.e., CITIC and Grupo Carso go up and down completely randomly.
Pair Corralation between CITIC and Grupo Carso
Assuming the 90 days horizon CITIC is expected to generate 1.9 times less return on investment than Grupo Carso. But when comparing it to its historical volatility, CITIC Limited is 1.34 times less risky than Grupo Carso. It trades about 0.03 of its potential returns per unit of risk. Grupo Carso SAB is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 545.00 in Grupo Carso SAB on September 12, 2024 and sell it today you would earn a total of 10.00 from holding Grupo Carso SAB or generate 1.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITIC Limited vs. Grupo Carso SAB
Performance |
| Timeline |
| CITIC Limited |
| Grupo Carso SAB |
CITIC and Grupo Carso Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITIC and Grupo Carso
The main advantage of trading using opposite CITIC and Grupo Carso positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIC position performs unexpectedly, Grupo Carso 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 Grupo Carso will offset losses from the drop in Grupo Carso's long position.| CITIC vs. THAI BEVERAGE | CITIC vs. Tsingtao Brewery | CITIC vs. LIFENET INSURANCE CO | CITIC vs. REVO INSURANCE SPA |
| Grupo Carso vs. ITOCHU | Grupo Carso vs. Marubeni | Grupo Carso vs. Sumitomo | Grupo Carso vs. Superior Plus Corp |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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