Correlation Between China Mobile and China World
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By analyzing existing cross correlation between China Mobile Limited and China World Trade, you can compare the effects of market volatilities on China Mobile and China World 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 China World. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and China World.
Diversification Opportunities for China Mobile and China World
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between China and China is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and China World Trade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China World Trade 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 China World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China World Trade has no effect on the direction of China Mobile i.e., China Mobile and China World go up and down completely randomly.
Pair Corralation between China Mobile and China World
Assuming the 90 days trading horizon China Mobile Limited is expected to generate 0.7 times more return on investment than China World. However, China Mobile Limited is 1.42 times less risky than China World. It trades about 0.27 of its potential returns per unit of risk. China World Trade is currently generating about 0.18 per unit of risk. If you would invest 10,636 in China Mobile Limited on September 28, 2024 and sell it today you would earn a total of 802.00 from holding China Mobile Limited or generate 7.54% 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. China World Trade
Performance |
| Timeline |
| China Mobile Limited |
| China World Trade |
China Mobile and China World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and China World
The main advantage of trading using opposite China Mobile and China World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, China World 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 China World will offset losses from the drop in China World's long position.| China Mobile vs. Chengdu Kanghua Biological | China Mobile vs. Beijing Wantai Biological | China Mobile vs. Suzhou Novoprotein Scientific | China Mobile vs. COL Digital Publishing |
| China World vs. Tianshui Huatian Technology | China World vs. Uxi Unicomp Technology | China World vs. Olympic Circuit Technology | China World vs. Pengxin International Mining |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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