Correlation Between China Communications and Nextcom
Can any of the company-specific risk be diversified away by investing in both China Communications and Nextcom 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 Nextcom 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 Nextcom, you can compare the effects of market volatilities on China Communications and Nextcom 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 Nextcom. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Communications and Nextcom.
Diversification Opportunities for China Communications and Nextcom
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Nextcom is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Communications Services and Nextcom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nextcom 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 Nextcom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nextcom has no effect on the direction of China Communications i.e., China Communications and Nextcom go up and down completely randomly.
Pair Corralation between China Communications and Nextcom
If you would invest 43.00 in China Communications Services on January 20, 2024 and sell it today you would earn a total of 0.00 from holding China Communications Services or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 86.36% |
| Values | Daily Returns |
China Communications Services vs. Nextcom
Performance |
| Timeline |
| China Communications |
| Nextcom |
China Communications and Nextcom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Communications and Nextcom
The main advantage of trading using opposite China Communications and Nextcom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Communications position performs unexpectedly, Nextcom 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 Nextcom will offset losses from the drop in Nextcom's long position.| China Communications vs. AAC Clyde Space | China Communications vs. Avante Logixx | China Communications vs. Corby Spirit and | China Communications vs. HUMANA INC |
| Nextcom vs. EN Shoham Business | Nextcom vs. Accel Solutions Group | Nextcom vs. SR Accord | Nextcom vs. Rapac Communication Infrastructure |
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 Managers module to screen money managers from public funds and ETFs managed around the world.
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