Correlation Between China Telecom and Postal Savings
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By analyzing existing cross correlation between China Telecom Corp and Postal Savings Bank, you can compare the effects of market volatilities on China Telecom and Postal Savings 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 Postal Savings. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Telecom and Postal Savings.
Diversification Opportunities for China Telecom and Postal Savings
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Postal is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding China Telecom Corp and Postal Savings Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Savings Bank 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 Postal Savings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Savings Bank has no effect on the direction of China Telecom i.e., China Telecom and Postal Savings go up and down completely randomly.
Pair Corralation between China Telecom and Postal Savings
Assuming the 90 days trading horizon China Telecom Corp is expected to generate 1.61 times more return on investment than Postal Savings. However, China Telecom is 1.61 times more volatile than Postal Savings Bank. It trades about -0.02 of its potential returns per unit of risk. Postal Savings Bank is currently generating about -0.23 per unit of risk. If you would invest 650.00 in China Telecom Corp on August 25, 2024 and sell it today you would lose (8.00) from holding China Telecom Corp or give up 1.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Telecom Corp vs. Postal Savings Bank
Performance |
| Timeline |
| China Telecom Corp |
| Postal Savings Bank |
China Telecom and Postal Savings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Telecom and Postal Savings
The main advantage of trading using opposite China Telecom and Postal Savings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Telecom position performs unexpectedly, Postal Savings 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 Postal Savings will offset losses from the drop in Postal Savings' long position.| China Telecom vs. Kunwu Jiuding Investment | China Telecom vs. Fiberhome Telecommunication Technologies | China Telecom vs. Jointo Energy Investment | China Telecom vs. Peoples Insurance of |
| Postal Savings vs. China Life Insurance | Postal Savings vs. Piotech Inc A | Postal Savings vs. Dongxing Sec Co | Postal Savings vs. Shanghai OPM Biosciences |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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