Correlation Between CITIC Securities and Sharetronic Data

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

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

Diversification Opportunities for CITIC Securities and Sharetronic Data

-0.12

Correlation Coefficient

CITIC Securities  Sharetronic Data

Good diversification

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

Pair Corralation between CITIC Securities and Sharetronic Data

Assuming the 90 days trading horizon CITIC Securities Co is expected to under-perform the Sharetronic Data. But the stock apears to be less risky and, when comparing its historical volatility, CITIC Securities Co is 2.87 times less risky than Sharetronic Data. The stock trades about -0.11 of its potential returns per unit of risk. The Sharetronic Data Technology is currently generating about 0.07 of returns per unit of risk over similar time horizon. 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

CITIC Securities Co  vs.  Sharetronic Data Technology

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.

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.

Pair Trading with CITIC Securities and Sharetronic Data

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

The idea behind CITIC Securities Co and Sharetronic Data Technology 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.

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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.