Correlation Between China Mobile and Sunny Loan
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By analyzing existing cross correlation between China Mobile Limited and Sunny Loan Top, you can compare the effects of market volatilities on China Mobile and Sunny Loan 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 Sunny Loan. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Sunny Loan.
Diversification Opportunities for China Mobile and Sunny Loan
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between China and Sunny is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Sunny Loan Top in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunny Loan Top 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 Sunny Loan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunny Loan Top has no effect on the direction of China Mobile i.e., China Mobile and Sunny Loan go up and down completely randomly.
Pair Corralation between China Mobile and Sunny Loan
Assuming the 90 days trading horizon China Mobile is expected to generate 8.58 times less return on investment than Sunny Loan. But when comparing it to its historical volatility, China Mobile Limited is 2.39 times less risky than Sunny Loan. It trades about 0.02 of its potential returns per unit of risk. Sunny Loan Top is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 604.00 in Sunny Loan Top on September 4, 2024 and sell it today you would earn a total of 468.00 from holding Sunny Loan Top or generate 77.48% 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. Sunny Loan Top
Performance |
| Timeline |
| China Mobile Limited |
| Sunny Loan Top |
China Mobile and Sunny Loan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Sunny Loan
The main advantage of trading using opposite China Mobile and Sunny Loan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Sunny Loan 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 Sunny Loan will offset losses from the drop in Sunny Loan's long position.| China Mobile vs. New China Life | China Mobile vs. Ming Yang Smart | China Mobile vs. 159681 | China Mobile vs. 159005 |
| Sunny Loan vs. China State Construction | Sunny Loan vs. Poly Real Estate | Sunny Loan vs. China Vanke Co | Sunny Loan vs. China Merchants Shekou |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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