Correlation Between China Union and China Mobile
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By analyzing existing cross correlation between China Union Holdings and China Mobile Limited, you can compare the effects of market volatilities on China Union and China Mobile 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 Union with a short position of China Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Union and China Mobile.
Diversification Opportunities for China Union and China Mobile
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between China and China is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding China Union Holdings and China Mobile Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Mobile Limited and China Union 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 Union Holdings are associated (or correlated) with China Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Mobile Limited has no effect on the direction of China Union i.e., China Union and China Mobile go up and down completely randomly.
Pair Corralation between China Union and China Mobile
Assuming the 90 days trading horizon China Union is expected to generate 8.23 times less return on investment than China Mobile. In addition to that, China Union is 1.32 times more volatile than China Mobile Limited. It trades about 0.01 of its total potential returns per unit of risk. China Mobile Limited is currently generating about 0.05 per unit of volatility. If you would invest 7,408 in China Mobile Limited on October 16, 2024 and sell it today you would earn a total of 3,432 from holding China Mobile Limited or generate 46.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Union Holdings vs. China Mobile Limited
Performance |
| Timeline |
| China Union Holdings |
| China Mobile Limited |
China Union and China Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Union and China Mobile
The main advantage of trading using opposite China Union and China Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Union position performs unexpectedly, China Mobile 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 China Mobile will offset losses from the drop in China Mobile's long position.| China Union vs. Zhejiang Yongjin Metal | China Union vs. Qiaoyin Environmental Tech | China Union vs. Shanghai Yanpu Metal | China Union vs. Ye Chiu Metal |
| China Mobile vs. Shuhua Sports Co | China Mobile vs. Hainan Haiqi Transportation | China Mobile vs. Sportsoul Co Ltd | China Mobile vs. Shandong Longquan Pipeline |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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