Correlation Between BYD Co and Hainan Airlines
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By analyzing existing cross correlation between BYD Co Ltd and Hainan Airlines Co, you can compare the effects of market volatilities on BYD Co and Hainan Airlines 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 BYD Co with a short position of Hainan Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD Co and Hainan Airlines.
Diversification Opportunities for BYD Co and Hainan Airlines
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BYD and Hainan is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding BYD Co Ltd and Hainan Airlines Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Airlines and BYD Co 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 BYD Co Ltd are associated (or correlated) with Hainan Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan Airlines has no effect on the direction of BYD Co i.e., BYD Co and Hainan Airlines go up and down completely randomly.
Pair Corralation between BYD Co and Hainan Airlines
Assuming the 90 days trading horizon BYD Co Ltd is expected to under-perform the Hainan Airlines. But the stock apears to be less risky and, when comparing its historical volatility, BYD Co Ltd is 1.73 times less risky than Hainan Airlines. The stock trades about -0.12 of its potential returns per unit of risk. The Hainan Airlines Co is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 31.00 in Hainan Airlines Co on October 12, 2024 and sell it today you would lose (1.00) from holding Hainan Airlines Co or give up 3.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BYD Co Ltd vs. Hainan Airlines Co
Performance |
| Timeline |
| BYD Co |
| Hainan Airlines |
BYD Co and Hainan Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYD Co and Hainan Airlines
The main advantage of trading using opposite BYD Co and Hainan Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD Co position performs unexpectedly, Hainan Airlines 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 Hainan Airlines will offset losses from the drop in Hainan Airlines' long position.| BYD Co vs. GRINM Semiconductor Materials | BYD Co vs. Nexchip Semiconductor Corp | BYD Co vs. Semiconductor Manufacturing Intl | BYD Co vs. Dynagreen Environmental Protection |
| Hainan Airlines vs. BYD Co Ltd | Hainan Airlines vs. China Mobile Limited | Hainan Airlines vs. Agricultural Bank of | Hainan Airlines vs. Industrial and Commercial |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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