Correlation Between China Telecom and Bank of Changsha
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By analyzing existing cross correlation between China Telecom Corp and Bank of Changsha, you can compare the effects of market volatilities on China Telecom and Bank of Changsha 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 Telecom with a short position of Bank of Changsha. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Telecom and Bank of Changsha.
Diversification Opportunities for China Telecom and Bank of Changsha
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Bank is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding China Telecom Corp and Bank of Changsha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Changsha and China Telecom 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 Telecom Corp are associated (or correlated) with Bank of Changsha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Changsha has no effect on the direction of China Telecom i.e., China Telecom and Bank of Changsha go up and down completely randomly.
Pair Corralation between China Telecom and Bank of Changsha
Assuming the 90 days trading horizon China Telecom is expected to generate 2.07 times less return on investment than Bank of Changsha. In addition to that, China Telecom is 1.06 times more volatile than Bank of Changsha. It trades about 0.06 of its total potential returns per unit of risk. Bank of Changsha is currently generating about 0.14 per unit of volatility. If you would invest 852.00 in Bank of Changsha on September 14, 2024 and sell it today you would earn a total of 34.00 from holding Bank of Changsha or generate 3.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Telecom Corp vs. Bank of Changsha
Performance |
| Timeline |
| China Telecom Corp |
| Bank of Changsha |
China Telecom and Bank of Changsha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Telecom and Bank of Changsha
The main advantage of trading using opposite China Telecom and Bank of Changsha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Telecom position performs unexpectedly, Bank of Changsha 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 Bank of Changsha will offset losses from the drop in Bank of Changsha's long position.| China Telecom vs. Changjiang Jinggong Steel | China Telecom vs. Hang Xiao Steel | China Telecom vs. JCHX Mining Management | China Telecom vs. Beijing SPC Environment |
| Bank of Changsha vs. Northking Information Technology | Bank of Changsha vs. AVCON Information Tech | Bank of Changsha vs. Invengo Information Technology | Bank of Changsha vs. Peoples Insurance of |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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