Correlation Between China Mobile and Rongcheer Industrial
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By analyzing existing cross correlation between China Mobile Limited and Rongcheer Industrial Technology, you can compare the effects of market volatilities on China Mobile and Rongcheer Industrial 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 Rongcheer Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Rongcheer Industrial.
Diversification Opportunities for China Mobile and Rongcheer Industrial
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Rongcheer is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Rongcheer Industrial Technolog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rongcheer Industrial 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 Rongcheer Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rongcheer Industrial has no effect on the direction of China Mobile i.e., China Mobile and Rongcheer Industrial go up and down completely randomly.
Pair Corralation between China Mobile and Rongcheer Industrial
Assuming the 90 days trading horizon China Mobile Limited is expected to generate 0.4 times more return on investment than Rongcheer Industrial. However, China Mobile Limited is 2.5 times less risky than Rongcheer Industrial. It trades about 0.22 of its potential returns per unit of risk. Rongcheer Industrial Technology is currently generating about 0.06 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. Rongcheer Industrial Technolog
Performance |
| Timeline |
| China Mobile Limited |
| Rongcheer Industrial |
China Mobile and Rongcheer Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Rongcheer Industrial
The main advantage of trading using opposite China Mobile and Rongcheer Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Rongcheer Industrial 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 Rongcheer Industrial will offset losses from the drop in Rongcheer Industrial's 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 |
| Rongcheer Industrial vs. Industrial and Commercial | Rongcheer Industrial vs. Kweichow Moutai Co | Rongcheer Industrial vs. Agricultural Bank of | Rongcheer Industrial 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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