Correlation Between China Mobile and Maoming Petro
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By analyzing existing cross correlation between China Mobile Limited and Maoming Petro Chemical Shihua, you can compare the effects of market volatilities on China Mobile and Maoming Petro 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 Maoming Petro. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Maoming Petro.
Diversification Opportunities for China Mobile and Maoming Petro
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and Maoming is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Maoming Petro Chemical Shihua in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maoming Petro Chemical 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 Maoming Petro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maoming Petro Chemical has no effect on the direction of China Mobile i.e., China Mobile and Maoming Petro go up and down completely randomly.
Pair Corralation between China Mobile and Maoming Petro
Assuming the 90 days trading horizon China Mobile is expected to generate 4.56 times less return on investment than Maoming Petro. But when comparing it to its historical volatility, China Mobile Limited is 1.69 times less risky than Maoming Petro. It trades about 0.02 of its potential returns per unit of risk. Maoming Petro Chemical Shihua is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 312.00 in Maoming Petro Chemical Shihua on October 26, 2024 and sell it today you would earn a total of 48.00 from holding Maoming Petro Chemical Shihua or generate 15.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Mobile Limited vs. Maoming Petro Chemical Shihua
Performance |
| Timeline |
| China Mobile Limited |
| Maoming Petro Chemical |
China Mobile and Maoming Petro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Maoming Petro
The main advantage of trading using opposite China Mobile and Maoming Petro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Maoming Petro 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 Maoming Petro will offset losses from the drop in Maoming Petro's long position.| China Mobile vs. Guangdong Jingyi Metal | China Mobile vs. Meinian Onehealth Healthcare | China Mobile vs. Mingchen Health Co | China Mobile vs. Shandong Hongchuang Aluminum |
| Maoming Petro vs. Fibocom Wireless | Maoming Petro vs. Jilin Jlu Communication | Maoming Petro vs. Beijing Bewinner Communications | Maoming Petro vs. China Mobile Limited |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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