Correlation Between China Mobile and Wintao Communications
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By analyzing existing cross correlation between China Mobile Limited and Wintao Communications Co, you can compare the effects of market volatilities on China Mobile and Wintao 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 Wintao Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Wintao Communications.
Diversification Opportunities for China Mobile and Wintao Communications
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and Wintao is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Wintao Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wintao 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 Wintao Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wintao Communications has no effect on the direction of China Mobile i.e., China Mobile and Wintao Communications go up and down completely randomly.
Pair Corralation between China Mobile and Wintao Communications
Assuming the 90 days trading horizon China Mobile Limited is expected to generate 0.46 times more return on investment than Wintao Communications. However, China Mobile Limited is 2.17 times less risky than Wintao Communications. It trades about 0.12 of its potential returns per unit of risk. Wintao Communications Co is currently generating about -0.25 per unit of risk. If you would invest 10,729 in China Mobile Limited on October 10, 2024 and sell it today you would earn a total of 394.00 from holding China Mobile Limited or generate 3.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.45% |
Values | Daily Returns |
China Mobile Limited vs. Wintao Communications Co
Performance |
Timeline |
China Mobile Limited |
Wintao Communications |
China Mobile and Wintao Communications Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Mobile and Wintao Communications
The main advantage of trading using opposite China Mobile and Wintao Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Wintao 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 Wintao Communications will offset losses from the drop in Wintao Communications' long position.China Mobile vs. Tianjin Silvery Dragon | China Mobile vs. Ningbo Tip Rubber | China Mobile vs. Xinjiang Baodi Mining | China Mobile vs. Jiangnan Mould Plastic |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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