Correlation Between CHINA TELECOM and Comba Telecom
Can any of the company-specific risk be diversified away by investing in both CHINA TELECOM and Comba 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 CHINA TELECOM and Comba Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHINA TELECOM H and Comba Telecom Systems, you can compare the effects of market volatilities on CHINA TELECOM and Comba 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 CHINA TELECOM with a short position of Comba Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHINA TELECOM and Comba Telecom.
Diversification Opportunities for CHINA TELECOM and Comba Telecom
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CHINA and Comba is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CHINA TELECOM H and Comba Telecom Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comba Telecom Systems 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 H are associated (or correlated) with Comba Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comba Telecom Systems has no effect on the direction of CHINA TELECOM i.e., CHINA TELECOM and Comba Telecom go up and down completely randomly.
Pair Corralation between CHINA TELECOM and Comba Telecom
Assuming the 90 days trading horizon CHINA TELECOM H is expected to generate 0.77 times more return on investment than Comba Telecom. However, CHINA TELECOM H is 1.3 times less risky than Comba Telecom. It trades about 0.1 of its potential returns per unit of risk. Comba Telecom Systems is currently generating about 0.02 per unit of risk. If you would invest 11.00 in CHINA TELECOM H on September 13, 2024 and sell it today you would earn a total of 41.00 from holding CHINA TELECOM H or generate 372.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
CHINA TELECOM H vs. Comba Telecom Systems
Performance |
| Timeline |
| CHINA TELECOM H |
| Comba Telecom Systems |
CHINA TELECOM and Comba Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHINA TELECOM and Comba Telecom
The main advantage of trading using opposite CHINA TELECOM and Comba Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHINA TELECOM position performs unexpectedly, Comba 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 Comba Telecom will offset losses from the drop in Comba Telecom's long position.| CHINA TELECOM vs. Apple Inc | CHINA TELECOM vs. Apple Inc | CHINA TELECOM vs. Apple Inc | CHINA TELECOM vs. Apple Inc |
| Comba Telecom vs. Apple Inc | Comba Telecom vs. Apple Inc | Comba Telecom vs. Apple Inc | Comba Telecom vs. Apple Inc |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |