Correlation Between AUSNUTRIA DAIRY and CHINA TELECOM
Can any of the company-specific risk be diversified away by investing in both AUSNUTRIA DAIRY and CHINA TELECOM at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining AUSNUTRIA DAIRY and CHINA TELECOM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AUSNUTRIA DAIRY and CHINA TELECOM H , you can compare the effects of market volatilities on AUSNUTRIA DAIRY and CHINA TELECOM 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 AUSNUTRIA DAIRY with a short position of CHINA TELECOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of AUSNUTRIA DAIRY and CHINA TELECOM.
Diversification Opportunities for AUSNUTRIA DAIRY and CHINA TELECOM
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AUSNUTRIA and CHINA is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding AUSNUTRIA DAIRY and CHINA TELECOM H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA TELECOM H and AUSNUTRIA DAIRY 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 AUSNUTRIA DAIRY are associated (or correlated) with CHINA TELECOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA TELECOM H has no effect on the direction of AUSNUTRIA DAIRY i.e., AUSNUTRIA DAIRY and CHINA TELECOM go up and down completely randomly.
Pair Corralation between AUSNUTRIA DAIRY and CHINA TELECOM
If you would invest 52.00 in CHINA TELECOM H on September 20, 2024 and sell it today you would earn a total of 0.00 from holding CHINA TELECOM H or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AUSNUTRIA DAIRY vs. CHINA TELECOM H
Performance |
| Timeline |
| AUSNUTRIA DAIRY |
| CHINA TELECOM H |
AUSNUTRIA DAIRY and CHINA TELECOM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AUSNUTRIA DAIRY and CHINA TELECOM
The main advantage of trading using opposite AUSNUTRIA DAIRY and CHINA TELECOM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AUSNUTRIA DAIRY position performs unexpectedly, CHINA TELECOM 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 TELECOM will offset losses from the drop in CHINA TELECOM's long position.| AUSNUTRIA DAIRY vs. Apple Inc | AUSNUTRIA DAIRY vs. Apple Inc | AUSNUTRIA DAIRY vs. Apple Inc | AUSNUTRIA DAIRY vs. Microsoft |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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