Correlation Between China Mobile and Xinjiang Communications
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By analyzing existing cross correlation between China Mobile Limited and Xinjiang Communications Construction, you can compare the effects of market volatilities on China Mobile and Xinjiang Communications 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 Xinjiang Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Xinjiang Communications.
Diversification Opportunities for China Mobile and Xinjiang Communications
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Xinjiang is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Xinjiang Communications Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Communications 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 Xinjiang Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Communications has no effect on the direction of China Mobile i.e., China Mobile and Xinjiang Communications go up and down completely randomly.
Pair Corralation between China Mobile and Xinjiang Communications
Assuming the 90 days trading horizon China Mobile Limited is expected to generate 0.74 times more return on investment than Xinjiang Communications. However, China Mobile Limited is 1.35 times less risky than Xinjiang Communications. It trades about 0.22 of its potential returns per unit of risk. Xinjiang Communications Construction is currently generating about 0.13 per unit of risk. If you would invest 10,085 in China Mobile Limited on September 13, 2024 and sell it today you would earn a total of 573.00 from holding China Mobile Limited or generate 5.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Mobile Limited vs. Xinjiang Communications Constr
Performance |
| Timeline |
| China Mobile Limited |
| Xinjiang Communications |
China Mobile and Xinjiang Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Xinjiang Communications
The main advantage of trading using opposite China Mobile and Xinjiang Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Xinjiang Communications 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 Xinjiang Communications will offset losses from the drop in Xinjiang Communications' long position.| China Mobile vs. Industrial and Commercial | China Mobile vs. China Construction Bank | China Mobile vs. Agricultural Bank of | China Mobile vs. Bank of China |
| Xinjiang Communications vs. Industrial and Commercial | Xinjiang Communications vs. Kweichow Moutai Co | Xinjiang Communications vs. Agricultural Bank of | Xinjiang Communications 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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