Correlation Between Geely Automobile and T Mobile
Can any of the company-specific risk be diversified away by investing in both Geely Automobile and T Mobile 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 Geely Automobile and T Mobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Geely Automobile Holdings and T Mobile, you can compare the effects of market volatilities on Geely Automobile and T 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 Geely Automobile with a short position of T Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geely Automobile and T Mobile.
Diversification Opportunities for Geely Automobile and T Mobile
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Geely and TM5 is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Geely Automobile Holdings and T Mobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on T Mobile and Geely Automobile 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 Geely Automobile Holdings are associated (or correlated) with T Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of T Mobile has no effect on the direction of Geely Automobile i.e., Geely Automobile and T Mobile go up and down completely randomly.
Pair Corralation between Geely Automobile and T Mobile
Assuming the 90 days horizon Geely Automobile is expected to generate 31.78 times less return on investment than T Mobile. But when comparing it to its historical volatility, Geely Automobile Holdings is 1.37 times less risky than T Mobile. It trades about 0.01 of its potential returns per unit of risk. T Mobile is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 21,255 in T Mobile on November 2, 2024 and sell it today you would earn a total of 1,575 from holding T Mobile or generate 7.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geely Automobile Holdings vs. T Mobile
Performance |
| Timeline |
| Geely Automobile Holdings |
| T Mobile |
Geely Automobile and T Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geely Automobile and T Mobile
The main advantage of trading using opposite Geely Automobile and T Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geely Automobile position performs unexpectedly, T 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 T Mobile will offset losses from the drop in T Mobile's long position.| Geely Automobile vs. Telecom Argentina SA | Geely Automobile vs. Highlight Communications AG | Geely Automobile vs. CanSino Biologics | Geely Automobile vs. CENTURIA OFFICE REIT |
| T Mobile vs. Air Transport Services | T Mobile vs. TITANIUM TRANSPORTGROUP | T Mobile vs. STORE ELECTRONIC | T Mobile vs. Richardson Electronics |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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