Correlation Between China Communications and SLR Investment
Can any of the company-specific risk be diversified away by investing in both China Communications and SLR Investment 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 China Communications and SLR Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Communications Services and SLR Investment Corp, you can compare the effects of market volatilities on China Communications and SLR Investment 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 Communications with a short position of SLR Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Communications and SLR Investment.
Diversification Opportunities for China Communications and SLR Investment
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and SLR is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding China Communications Services and SLR Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SLR Investment Corp and China Communications 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 Communications Services are associated (or correlated) with SLR Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SLR Investment Corp has no effect on the direction of China Communications i.e., China Communications and SLR Investment go up and down completely randomly.
Pair Corralation between China Communications and SLR Investment
Assuming the 90 days horizon China Communications Services is expected to generate 5.72 times more return on investment than SLR Investment. However, China Communications is 5.72 times more volatile than SLR Investment Corp. It trades about 0.06 of its potential returns per unit of risk. SLR Investment Corp is currently generating about 0.08 per unit of risk. If you would invest 21.00 in China Communications Services on August 29, 2024 and sell it today you would earn a total of 27.00 from holding China Communications Services or generate 128.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Communications Services vs. SLR Investment Corp
Performance |
| Timeline |
| China Communications |
| SLR Investment Corp |
China Communications and SLR Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Communications and SLR Investment
The main advantage of trading using opposite China Communications and SLR Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Communications position performs unexpectedly, SLR Investment 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 SLR Investment will offset losses from the drop in SLR Investment's long position.| China Communications vs. Verizon Communications | China Communications vs. ATT Inc | China Communications vs. ATT Inc | China Communications vs. Deutsche Telekom AG |
| SLR Investment vs. Axcelis Technologies | SLR Investment vs. SOFI TECHNOLOGIES | SLR Investment vs. Data3 Limited | SLR Investment vs. INFORMATION SVC GRP |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |