Correlation Between China Mobile and Runjian Communication
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By analyzing existing cross correlation between China Mobile Limited and Runjian Communication Co, you can compare the effects of market volatilities on China Mobile and Runjian Communication 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 Runjian Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Runjian Communication.
Diversification Opportunities for China Mobile and Runjian Communication
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Runjian is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Runjian Communication Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Runjian Communication 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 Runjian Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Runjian Communication has no effect on the direction of China Mobile i.e., China Mobile and Runjian Communication go up and down completely randomly.
Pair Corralation between China Mobile and Runjian Communication
Assuming the 90 days trading horizon China Mobile Limited is expected to under-perform the Runjian Communication. But the stock apears to be less risky and, when comparing its historical volatility, China Mobile Limited is 2.8 times less risky than Runjian Communication. The stock trades about -0.19 of its potential returns per unit of risk. The Runjian Communication Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 3,316 in Runjian Communication Co on October 24, 2024 and sell it today you would earn a total of 4.00 from holding Runjian Communication Co or generate 0.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Mobile Limited vs. Runjian Communication Co
Performance |
| Timeline |
| China Mobile Limited |
| Runjian Communication |
China Mobile and Runjian Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Runjian Communication
The main advantage of trading using opposite China Mobile and Runjian Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Runjian Communication 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 Runjian Communication will offset losses from the drop in Runjian Communication's long position.| China Mobile vs. Beijing Mainstreets Investment | China Mobile vs. Jointo Energy Investment | China Mobile vs. Zoje Resources Investment | China Mobile vs. Jiangsu Yueda Investment |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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