Correlation Between CoinShares International and CITIC Securities

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

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

Diversification Opportunities for CoinShares International and CITIC Securities

0.75

Correlation Coefficient

CoinShares International  CITIC Securities

Poor diversification

The 3 months correlation between CoinShares and CITIC is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding CoinShares International and CITIC Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITIC Securities and CoinShares International 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 CoinShares International 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 CoinShares International i.e., CoinShares International and CITIC Securities go up and down completely randomly.

Pair Corralation between CoinShares International and CITIC Securities

Assuming the 90 days horizon CoinShares International is expected to generate 1.17 times more return on investment than CITIC Securities. However, CoinShares International is 1.17 times more volatile than CITIC Securities. It trades about 0.18 of its potential returns per unit of risk. CITIC Securities is currently generating about 0.13 per unit of risk. If you would invest  7,802  in CoinShares International on May 8, 2025 and sell it today you would earn a total of  2,558  from holding CoinShares International or generate 32.79% return on investment over 90 days.

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

CoinShares International  vs.  CITIC Securities

CoinShares International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CoinShares International are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CoinShares International unveiled 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 CoinShares International and CITIC Securities

The main advantage of trading using opposite CoinShares International and CITIC Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CoinShares International 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 CoinShares International 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.