Correlation Between China Mobile and Jiangsu Changfa
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By analyzing existing cross correlation between China Mobile Limited and Jiangsu Changfa Refrigeration, you can compare the effects of market volatilities on China Mobile and Jiangsu Changfa 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 Jiangsu Changfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Jiangsu Changfa.
Diversification Opportunities for China Mobile and Jiangsu Changfa
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and Jiangsu is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Jiangsu Changfa Refrigeration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Changfa Refr 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 Jiangsu Changfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Changfa Refr has no effect on the direction of China Mobile i.e., China Mobile and Jiangsu Changfa go up and down completely randomly.
Pair Corralation between China Mobile and Jiangsu Changfa
Assuming the 90 days trading horizon China Mobile is expected to generate 3.98 times less return on investment than Jiangsu Changfa. But when comparing it to its historical volatility, China Mobile Limited is 2.11 times less risky than Jiangsu Changfa. It trades about 0.05 of its potential returns per unit of risk. Jiangsu Changfa Refrigeration is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 370.00 in Jiangsu Changfa Refrigeration on September 5, 2024 and sell it today you would earn a total of 112.00 from holding Jiangsu Changfa Refrigeration or generate 30.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Mobile Limited vs. Jiangsu Changfa Refrigeration
Performance |
| Timeline |
| China Mobile Limited |
| Jiangsu Changfa Refr |
China Mobile and Jiangsu Changfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Jiangsu Changfa
The main advantage of trading using opposite China Mobile and Jiangsu Changfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Jiangsu Changfa 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 Jiangsu Changfa will offset losses from the drop in Jiangsu Changfa's long position.| China Mobile vs. Ye Chiu Metal | China Mobile vs. Jiangsu Financial Leasing | China Mobile vs. Xiwang Foodstuffs Co | China Mobile vs. Jiamei Food Packaging |
| Jiangsu Changfa vs. PetroChina Co Ltd | Jiangsu Changfa vs. China Mobile Limited | Jiangsu Changfa vs. CNOOC Limited | Jiangsu Changfa 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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