Correlation Between China Mobile and Longjian Road
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By analyzing existing cross correlation between China Mobile Limited and Longjian Road Bridge, you can compare the effects of market volatilities on China Mobile and Longjian Road 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 Longjian Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Longjian Road.
Diversification Opportunities for China Mobile and Longjian Road
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between China and Longjian is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Longjian Road Bridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longjian Road Bridge 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 Longjian Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longjian Road Bridge has no effect on the direction of China Mobile i.e., China Mobile and Longjian Road go up and down completely randomly.
Pair Corralation between China Mobile and Longjian Road
Assuming the 90 days trading horizon China Mobile is expected to generate 2.93 times less return on investment than Longjian Road. But when comparing it to its historical volatility, China Mobile Limited is 1.18 times less risky than Longjian Road. It trades about 0.03 of its potential returns per unit of risk. Longjian Road Bridge is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 371.00 in Longjian Road Bridge on November 27, 2024 and sell it today you would earn a total of 6.00 from holding Longjian Road Bridge or generate 1.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Mobile Limited vs. Longjian Road Bridge
Performance |
| Timeline |
| China Mobile Limited |
| Longjian Road Bridge |
China Mobile and Longjian Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Longjian Road
The main advantage of trading using opposite China Mobile and Longjian Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Longjian Road 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 Longjian Road will offset losses from the drop in Longjian Road's long position.| China Mobile vs. Caihong Display Devices | China Mobile vs. Beijing Kingsoft Office | China Mobile vs. Suofeiya Home Collection | China Mobile vs. Hua Hong Semiconductor |
| Longjian Road vs. By health | Longjian Road vs. Gansu Huangtai Wine marketing | Longjian Road vs. China Reform Health | Longjian Road vs. Hengxin Mobile Business |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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