Correlation Between CITIC and Canon Marketing
Can any of the company-specific risk be diversified away by investing in both CITIC and Canon Marketing 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 Canon Marketing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITIC Limited and Canon Marketing Japan, you can compare the effects of market volatilities on CITIC and Canon Marketing 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 Canon Marketing. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIC and Canon Marketing.
Diversification Opportunities for CITIC and Canon Marketing
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between CITIC and Canon is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding CITIC Limited and Canon Marketing Japan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canon Marketing Japan 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 Canon Marketing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canon Marketing Japan has no effect on the direction of CITIC i.e., CITIC and Canon Marketing go up and down completely randomly.
Pair Corralation between CITIC and Canon Marketing
Assuming the 90 days horizon CITIC Limited is expected to under-perform the Canon Marketing. In addition to that, CITIC is 1.89 times more volatile than Canon Marketing Japan. It trades about -0.02 of its total potential returns per unit of risk. Canon Marketing Japan is currently generating about 0.16 per unit of volatility. If you would invest 3,100 in Canon Marketing Japan on October 9, 2024 and sell it today you would earn a total of 80.00 from holding Canon Marketing Japan or generate 2.58% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
CITIC Limited vs. Canon Marketing Japan
Performance |
Timeline |
CITIC Limited |
Canon Marketing Japan |
CITIC and Canon Marketing Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CITIC and Canon Marketing
The main advantage of trading using opposite CITIC and Canon Marketing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIC position performs unexpectedly, Canon Marketing 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 Canon Marketing will offset losses from the drop in Canon Marketing's long position.CITIC vs. DFS Furniture PLC | CITIC vs. Magnachip Semiconductor | CITIC vs. Elmos Semiconductor SE | CITIC vs. Tower Semiconductor |
Canon Marketing vs. Canon Inc | Canon Marketing vs. Canon Inc | Canon Marketing vs. Ricoh Company | Canon Marketing vs. Brother Industries |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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