Correlation Between United Airlines and Silvercorp Metals
Can any of the company-specific risk be diversified away by investing in both United Airlines and Silvercorp Metals 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 United Airlines and Silvercorp Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Airlines Holdings and Silvercorp Metals, you can compare the effects of market volatilities on United Airlines and Silvercorp Metals 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 United Airlines with a short position of Silvercorp Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Airlines and Silvercorp Metals.
Diversification Opportunities for United Airlines and Silvercorp Metals
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between United and Silvercorp is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding United Airlines Holdings and Silvercorp Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silvercorp Metals and United Airlines 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 United Airlines Holdings are associated (or correlated) with Silvercorp Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silvercorp Metals has no effect on the direction of United Airlines i.e., United Airlines and Silvercorp Metals go up and down completely randomly.
Pair Corralation between United Airlines and Silvercorp Metals
Assuming the 90 days trading horizon United Airlines Holdings is expected to generate 0.83 times more return on investment than Silvercorp Metals. However, United Airlines Holdings is 1.2 times less risky than Silvercorp Metals. It trades about 0.14 of its potential returns per unit of risk. Silvercorp Metals is currently generating about 0.04 per unit of risk. If you would invest 4,145 in United Airlines Holdings on September 24, 2024 and sell it today you would earn a total of 5,528 from holding United Airlines Holdings or generate 133.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
United Airlines Holdings vs. Silvercorp Metals
Performance |
| Timeline |
| United Airlines Holdings |
| Silvercorp Metals |
United Airlines and Silvercorp Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Airlines and Silvercorp Metals
The main advantage of trading using opposite United Airlines and Silvercorp Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Airlines position performs unexpectedly, Silvercorp Metals 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 Silvercorp Metals will offset losses from the drop in Silvercorp Metals' long position.| United Airlines vs. Uniper SE | United Airlines vs. Mulberry Group PLC | United Airlines vs. London Security Plc | United Airlines vs. Triad Group PLC |
| Silvercorp Metals vs. Jupiter Fund Management | Silvercorp Metals vs. United Airlines Holdings | Silvercorp Metals vs. JB Hunt Transport | Silvercorp Metals vs. Vienna Insurance Group |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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