Correlation Between China Mobile and ChengDu Hi
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By analyzing existing cross correlation between China Mobile Limited and ChengDu Hi Tech Development, you can compare the effects of market volatilities on China Mobile and ChengDu Hi 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 China Mobile with a short position of ChengDu Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and ChengDu Hi.
Diversification Opportunities for China Mobile and ChengDu Hi
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between China and ChengDu is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and ChengDu Hi Tech Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChengDu Hi Tech and China Mobile 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 China Mobile Limited are associated (or correlated) with ChengDu Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChengDu Hi Tech has no effect on the direction of China Mobile i.e., China Mobile and ChengDu Hi go up and down completely randomly.
Pair Corralation between China Mobile and ChengDu Hi
Assuming the 90 days trading horizon China Mobile is expected to generate 5.08 times less return on investment than ChengDu Hi. But when comparing it to its historical volatility, China Mobile Limited is 3.12 times less risky than ChengDu Hi. It trades about 0.12 of its potential returns per unit of risk. ChengDu Hi Tech Development is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 3,977 in ChengDu Hi Tech Development on September 23, 2024 and sell it today you would earn a total of 2,344 from holding ChengDu Hi Tech Development or generate 58.94% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
China Mobile Limited vs. ChengDu Hi Tech Development
Performance |
Timeline |
China Mobile Limited |
ChengDu Hi Tech |
China Mobile and ChengDu Hi Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Mobile and ChengDu Hi
The main advantage of trading using opposite China Mobile and ChengDu Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, ChengDu Hi 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 ChengDu Hi will offset losses from the drop in ChengDu Hi's long position.China Mobile vs. Chengdu Kanghua Biological | China Mobile vs. Beijing Wantai Biological | China Mobile vs. Suzhou Novoprotein Scientific | China Mobile vs. COL Digital Publishing |
ChengDu Hi vs. PetroChina Co Ltd | ChengDu Hi vs. China Mobile Limited | ChengDu Hi vs. CNOOC Limited | ChengDu Hi vs. Ping An Insurance |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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