Correlation Between Citic Telecom and North American
Can any of the company-specific risk be diversified away by investing in both Citic Telecom and North American 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 Telecom and North American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citic Telecom International and North American Construction, you can compare the effects of market volatilities on Citic Telecom and North American 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 Telecom with a short position of North American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citic Telecom and North American.
Diversification Opportunities for Citic Telecom and North American
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citic and North is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Citic Telecom International and North American Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North American Const and Citic Telecom 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 Telecom International are associated (or correlated) with North American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North American Const has no effect on the direction of Citic Telecom i.e., Citic Telecom and North American go up and down completely randomly.
Pair Corralation between Citic Telecom and North American
Assuming the 90 days trading horizon Citic Telecom International is expected to generate 1.19 times more return on investment than North American. However, Citic Telecom is 1.19 times more volatile than North American Construction. It trades about 0.01 of its potential returns per unit of risk. North American Construction is currently generating about -0.15 per unit of risk. If you would invest 27.00 in Citic Telecom International on December 28, 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 Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Citic Telecom International vs. North American Construction
Performance |
Timeline |
Citic Telecom Intern |
North American Const |
Citic Telecom and North American Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Citic Telecom and North American
The main advantage of trading using opposite Citic Telecom and North American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citic Telecom position performs unexpectedly, North American 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 North American will offset losses from the drop in North American's long position.Citic Telecom vs. COMM HEALTH SYSTEMS | Citic Telecom vs. GUARDANT HEALTH CL | Citic Telecom vs. Direct Line Insurance | Citic Telecom vs. JSC Halyk bank |
North American vs. RETAIL FOOD GROUP | North American vs. Applied Materials | North American vs. GEAR4MUSIC LS 10 | North American vs. Tencent Music Entertainment |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Technical Analysis Check basic technical indicators and analysis based on most latest market data |