Correlation Between Sharetronic Data and CITIC Securities

Can any of the company-specific risk be diversified away by investing in both Sharetronic Data and CITIC Securities 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 Sharetronic Data and CITIC Securities into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sharetronic Data Technology and CITIC Securities Co, you can compare the effects of market volatilities on Sharetronic Data and CITIC Securities 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 Sharetronic Data with a short position of CITIC Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sharetronic Data and CITIC Securities.

Diversification Opportunities for Sharetronic Data and CITIC Securities

-0.12

Correlation Coefficient

Sharetronic Data  CITIC Securities

Good diversification

The 3 months correlation between Sharetronic and CITIC is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Sharetronic Data Technology and CITIC Securities Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITIC Securities and Sharetronic Data 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 Sharetronic Data Technology are associated (or correlated) with CITIC Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CITIC Securities has no effect on the direction of Sharetronic Data i.e., Sharetronic Data and CITIC Securities go up and down completely randomly.

Pair Corralation between Sharetronic Data and CITIC Securities

Assuming the 90 days trading horizon Sharetronic Data Technology is expected to generate 2.87 times more return on investment than CITIC Securities. However, Sharetronic Data is 2.87 times more volatile than CITIC Securities Co. It trades about 0.07 of its potential returns per unit of risk. CITIC Securities Co is currently generating about -0.11 per unit of risk. If you would invest  10,060  in Sharetronic Data Technology on December 27, 2024 and sell it today you would earn a total of  1,456  from holding Sharetronic Data Technology or generate 14.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Sharetronic Data Technology  vs.  CITIC Securities Co

Sharetronic Data Tec

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Sharetronic Data Technology are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Sharetronic Data sustained solid returns over the last few months and may actually be approaching a breakup point.

CITIC Securities

Risk-Adjusted Performance

Very Weak

Over the last 90 days CITIC Securities Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Sharetronic Data and CITIC Securities

The main advantage of trading using opposite Sharetronic Data and CITIC Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sharetronic Data position performs unexpectedly, CITIC Securities 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 Securities will offset losses from the drop in CITIC Securities' long position.

The idea behind Sharetronic Data Technology and CITIC Securities Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 CEOs Directory module to screen CEOs from public companies around the world.