Correlation Between China State and China Mobile
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By analyzing existing cross correlation between China State Construction and China Mobile Limited, you can compare the effects of market volatilities on China State and China Mobile 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 State with a short position of China Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and China Mobile.
Diversification Opportunities for China State and China Mobile
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and China is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and China Mobile Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Mobile Limited and China State 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 State Construction are associated (or correlated) with China Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Mobile Limited has no effect on the direction of China State i.e., China State and China Mobile go up and down completely randomly.
Pair Corralation between China State and China Mobile
Assuming the 90 days trading horizon China State Construction is expected to under-perform the China Mobile. In addition to that, China State is 1.83 times more volatile than China Mobile Limited. It trades about -0.09 of its total potential returns per unit of risk. China Mobile Limited is currently generating about 0.05 per unit of volatility. If you would invest 10,229 in China Mobile Limited on August 27, 2024 and sell it today you would earn a total of 111.00 from holding China Mobile Limited or generate 1.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China State Construction vs. China Mobile Limited
Performance |
| Timeline |
| China State Construction |
| China Mobile Limited |
China State and China Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and China Mobile
The main advantage of trading using opposite China State and China Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, China Mobile 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 Mobile will offset losses from the drop in China Mobile's long position.| China State vs. Ming Yang Smart | China State vs. 159681 | China State vs. 159005 | China State vs. Loctek Ergonomic Technology |
| China Mobile vs. Chongqing Shunbo Aluminum | China Mobile vs. Haima Automobile Group | China Mobile vs. Changchun Faway Automobile | China Mobile vs. Sunwave Communications Co |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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