Correlation Between Circle Internet and CITIC Securities

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

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

Diversification Opportunities for Circle Internet and CITIC Securities

0.53

Correlation Coefficient

Circle Internet  CITIC Securities

Very weak diversification

The 3 months correlation between Circle and CITIC is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Circle Internet Group, and CITIC Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITIC Securities and Circle Internet 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 Circle Internet Group, 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 Circle Internet i.e., Circle Internet and CITIC Securities go up and down completely randomly.

Pair Corralation between Circle Internet and CITIC Securities

Given the investment horizon of 90 days Circle Internet Group, is expected to generate 11.26 times more return on investment than CITIC Securities. However, Circle Internet is 11.26 times more volatile than CITIC Securities. It trades about 0.21 of its potential returns per unit of risk. CITIC Securities is currently generating about 0.13 per unit of risk. If you would invest  3,100  in Circle Internet Group, on May 10, 2025 and sell it today you would earn a total of  12,193  from holding Circle Internet Group, or generate 393.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	73.77%
Values	Daily Returns

Circle Internet Group,  vs.  CITIC Securities

Circle Internet Group,

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Circle Internet Group, are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady fundamental indicators, Circle Internet disclosed solid returns over the last few months and may actually be approaching a breakup point.

CITIC Securities

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in CITIC Securities are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical indicators, CITIC Securities reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Circle Internet and CITIC Securities

The main advantage of trading using opposite Circle Internet and CITIC Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Circle Internet 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 Circle Internet Group, and CITIC Securities 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.