Correlation Between New Hope and China Mobile
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By analyzing existing cross correlation between New Hope Dairy and China Mobile Limited, you can compare the effects of market volatilities on New Hope 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 New Hope with a short position of China Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Hope and China Mobile.
Diversification Opportunities for New Hope and China Mobile
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between New and China is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding New Hope Dairy 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 New Hope 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 New Hope Dairy 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 New Hope i.e., New Hope and China Mobile go up and down completely randomly.
Pair Corralation between New Hope and China Mobile
Assuming the 90 days trading horizon New Hope Dairy is expected to generate 1.92 times more return on investment than China Mobile. However, New Hope is 1.92 times more volatile than China Mobile Limited. It trades about 0.03 of its potential returns per unit of risk. China Mobile Limited is currently generating about -0.2 per unit of risk. If you would invest 1,440 in New Hope Dairy on October 28, 2024 and sell it today you would earn a total of 10.00 from holding New Hope Dairy or generate 0.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
New Hope Dairy vs. China Mobile Limited
Performance |
| Timeline |
| New Hope Dairy |
| China Mobile Limited |
New Hope and China Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Hope and China Mobile
The main advantage of trading using opposite New Hope and China Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Hope 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.| New Hope vs. Hangzhou Minsheng Healthcare | New Hope vs. Andon Health Co | New Hope vs. Kontour Medical Technology | New Hope vs. MayAir Technology Co |
| China Mobile vs. Sharetronic Data Technology | China Mobile vs. HUAQIN TECHNOLOGY LTD | China Mobile vs. Beijing Mainstreets Investment | China Mobile vs. Postal Savings Bank |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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