Correlation Between CITIC and DATA MODUL

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

By analyzing existing cross correlation between CITIC Limited and DATA MODUL , you can compare the effects of market volatilities on CITIC and DATA MODUL 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 DATA MODUL. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIC and DATA MODUL.

Diversification Opportunities for CITIC and DATA MODUL

0.7

Correlation Coefficient

CITIC  DATA MODUL

Poor diversification

The 3 months correlation between CITIC and DATA is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding CITIC Limited and DATA MODUL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DATA MODUL 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 DATA MODUL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DATA MODUL has no effect on the direction of CITIC i.e., CITIC and DATA MODUL go up and down completely randomly.

Pair Corralation between CITIC and DATA MODUL

Assuming the 90 days horizon CITIC is expected to generate 1.41 times less return on investment than DATA MODUL. But when comparing it to its historical volatility, CITIC Limited is 1.21 times less risky than DATA MODUL. It trades about 0.15 of its potential returns per unit of risk. DATA MODUL is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  2,240  in DATA MODUL on August 15, 2025 and sell it today you would earn a total of  580.00  from holding DATA MODUL or generate 25.89% return on investment over 90 days.

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

CITIC Limited  vs.  DATA MODUL

CITIC Limited

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in CITIC Limited are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, CITIC reported solid returns over the last few months and may actually be approaching a breakup point.

DATA MODUL

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in DATA MODUL are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile primary indicators, DATA MODUL unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CITIC and DATA MODUL

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

The idea behind CITIC Limited and DATA MODUL 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.