Correlation Between CITIC Resources and Blackstone Minerals

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

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

Diversification Opportunities for CITIC Resources and Blackstone Minerals

-0.19

Correlation Coefficient

CITIC Resources  Blackstone Minerals

Good diversification

The 3 months correlation between CITIC and Blackstone is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding CITIC Resources Holdings and Blackstone Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Minerals and CITIC Resources 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 Resources Holdings are associated (or correlated) with Blackstone Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Minerals has no effect on the direction of CITIC Resources i.e., CITIC Resources and Blackstone Minerals go up and down completely randomly.

Pair Corralation between CITIC Resources and Blackstone Minerals

If you would invest  0.01  in Blackstone Minerals on September 22, 2024 and sell it today you would earn a total of  1.49  from holding Blackstone Minerals or generate 14900.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.54%
Values	Daily Returns

CITIC Resources Holdings  vs.  Blackstone Minerals

CITIC Resources Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CITIC Resources Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical indicators, CITIC Resources is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Blackstone Minerals

Risk-Adjusted Performance

12 of 100

Good

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

Pair Trading with CITIC Resources and Blackstone Minerals

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

The idea behind CITIC Resources Holdings and Blackstone Minerals 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.