Correlation Between Tibet Summit and China Satellite
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By analyzing existing cross correlation between Tibet Summit Resources and China Satellite Communications, you can compare the effects of market volatilities on Tibet Summit and China Satellite 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 Tibet Summit with a short position of China Satellite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tibet Summit and China Satellite.
Diversification Opportunities for Tibet Summit and China Satellite
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tibet and China is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Tibet Summit Resources and China Satellite Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Satellite Comm and Tibet Summit 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 Tibet Summit Resources are associated (or correlated) with China Satellite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Satellite Comm has no effect on the direction of Tibet Summit i.e., Tibet Summit and China Satellite go up and down completely randomly.
Pair Corralation between Tibet Summit and China Satellite
Assuming the 90 days trading horizon Tibet Summit Resources is expected to under-perform the China Satellite. But the stock apears to be less risky and, when comparing its historical volatility, Tibet Summit Resources is 1.19 times less risky than China Satellite. The stock trades about -0.04 of its potential returns per unit of risk. The China Satellite Communications is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,203 in China Satellite Communications on September 5, 2024 and sell it today you would earn a total of 1,043 from holding China Satellite Communications or generate 86.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tibet Summit Resources vs. China Satellite Communications
Performance |
| Timeline |
| Tibet Summit Resources |
| China Satellite Comm |
Tibet Summit and China Satellite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tibet Summit and China Satellite
The main advantage of trading using opposite Tibet Summit and China Satellite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tibet Summit position performs unexpectedly, China Satellite 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 Satellite will offset losses from the drop in China Satellite's long position.| Tibet Summit vs. China Satellite Communications | Tibet Summit vs. Fiberhome Telecommunication Technologies | Tibet Summit vs. Focus Media Information | Tibet Summit vs. Dalian Zeus Entertainment |
| China Satellite vs. Shengda Mining Co | China Satellite vs. Western Metal Materials | China Satellite vs. Rising Nonferrous Metals | China Satellite vs. Hainan Mining Co |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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