Correlation Between China Mobile and Huitong Construction
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By analyzing existing cross correlation between China Mobile Limited and Huitong Construction Group, you can compare the effects of market volatilities on China Mobile and Huitong Construction 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 Huitong Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Huitong Construction.
Diversification Opportunities for China Mobile and Huitong Construction
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and Huitong is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Huitong Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huitong Construction 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 Huitong Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huitong Construction has no effect on the direction of China Mobile i.e., China Mobile and Huitong Construction go up and down completely randomly.
Pair Corralation between China Mobile and Huitong Construction
Assuming the 90 days trading horizon China Mobile is expected to generate 7.8 times less return on investment than Huitong Construction. But when comparing it to its historical volatility, China Mobile Limited is 2.2 times less risky than Huitong Construction. It trades about 0.01 of its potential returns per unit of risk. Huitong Construction Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 450.00 in Huitong Construction Group on September 1, 2024 and sell it today you would earn a total of 73.00 from holding Huitong Construction Group or generate 16.22% 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. Huitong Construction Group
Performance |
| Timeline |
| China Mobile Limited |
| Huitong Construction |
China Mobile and Huitong Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Huitong Construction
The main advantage of trading using opposite China Mobile and Huitong Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Huitong Construction 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 Huitong Construction will offset losses from the drop in Huitong Construction's long position.| China Mobile vs. Kweichow Moutai Co | China Mobile vs. NAURA Technology Group | China Mobile vs. APT Medical | China Mobile vs. BYD Co Ltd |
| Huitong Construction vs. 159681 | Huitong Construction vs. 159005 | Huitong Construction vs. Loctek Ergonomic Technology | Huitong Construction vs. 516220 |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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