Correlation Between Xinhua Winshare and T-MOBILE

Can any of the company-specific risk be diversified away by investing in both Xinhua Winshare 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 Xinhua Winshare and T-MOBILE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Xinhua Winshare Publishing and T MOBILE US, you can compare the effects of market volatilities on Xinhua Winshare 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 Xinhua Winshare with a short position of T-MOBILE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinhua Winshare and T-MOBILE.

Diversification Opportunities for Xinhua Winshare and T-MOBILE

-0.1

Correlation Coefficient

Xinhua Winshare  T-MOBILE

Good diversification

The 3 months correlation between Xinhua and T-MOBILE is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Xinhua Winshare Publishing and T MOBILE US in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on T MOBILE US and Xinhua Winshare 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 Xinhua Winshare Publishing 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 US has no effect on the direction of Xinhua Winshare i.e., Xinhua Winshare and T-MOBILE go up and down completely randomly.

Pair Corralation between Xinhua Winshare and T-MOBILE

Assuming the 90 days horizon Xinhua Winshare Publishing is expected to under-perform the T-MOBILE. In addition to that, Xinhua Winshare is 1.48 times more volatile than T MOBILE US. It trades about -0.07 of its total potential returns per unit of risk. T MOBILE US is currently generating about 0.02 per unit of volatility. If you would invest  21,170  in T MOBILE US on October 21, 2024 and sell it today you would earn a total of  65.00  from holding T MOBILE US or generate 0.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Xinhua Winshare Publishing  vs.  T MOBILE US

Xinhua Winshare Publ

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Xinhua Winshare Publishing are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Xinhua Winshare may actually be approaching a critical reversion point that can send shares even higher in February 2025.

T MOBILE US

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in T MOBILE US are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, T-MOBILE is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Xinhua Winshare and T-MOBILE

The main advantage of trading using opposite Xinhua Winshare and T-MOBILE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinhua Winshare 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.

The idea behind Xinhua Winshare Publishing and T MOBILE US pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.