Correlation Between China Mobile and Ford
Can any of the company-specific risk be diversified away by investing in both China Mobile and Ford 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 Mobile and Ford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Mobile Limited and Ford Motor, you can compare the effects of market volatilities on China Mobile and Ford 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 Mobile with a short position of Ford. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mobile and Ford.
Diversification Opportunities for China Mobile and Ford
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Ford is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Mobile Limited and Ford Motor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ford Motor and China Mobile 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 Mobile Limited are associated (or correlated) with Ford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ford Motor has no effect on the direction of China Mobile i.e., China Mobile and Ford go up and down completely randomly.
Pair Corralation between China Mobile and Ford
If you would invest (100.00) in China Mobile Limited on January 20, 2024 and sell it today you would earn a total of 100.00 from holding China Mobile Limited or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
China Mobile Limited vs. Ford Motor
Performance |
| Timeline |
| China Mobile Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Ford Motor |
China Mobile and Ford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mobile and Ford
The main advantage of trading using opposite China Mobile and Ford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mobile position performs unexpectedly, Ford 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 Ford will offset losses from the drop in Ford's long position.| China Mobile vs. Microbot Medical | China Mobile vs. Avient Corp | China Mobile vs. Teleflex Incorporated | China Mobile vs. Merit Medical Systems |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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