Correlation Between Hainan Airlines and Pengxin International
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By analyzing existing cross correlation between Hainan Airlines Co and Pengxin International Mining, you can compare the effects of market volatilities on Hainan Airlines and Pengxin International 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 Hainan Airlines with a short position of Pengxin International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Airlines and Pengxin International.
Diversification Opportunities for Hainan Airlines and Pengxin International
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hainan and Pengxin is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Airlines Co and Pengxin International Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pengxin International and Hainan 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 Hainan Airlines Co are associated (or correlated) with Pengxin International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pengxin International has no effect on the direction of Hainan Airlines i.e., Hainan Airlines and Pengxin International go up and down completely randomly.
Pair Corralation between Hainan Airlines and Pengxin International
Assuming the 90 days trading horizon Hainan Airlines Co is expected to generate 2.11 times more return on investment than Pengxin International. However, Hainan Airlines is 2.11 times more volatile than Pengxin International Mining. It trades about 0.29 of its potential returns per unit of risk. Pengxin International Mining is currently generating about 0.2 per unit of risk. If you would invest 118.00 in Hainan Airlines Co on August 25, 2024 and sell it today you would earn a total of 53.00 from holding Hainan Airlines Co or generate 44.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hainan Airlines Co vs. Pengxin International Mining
Performance |
| Timeline |
| Hainan Airlines |
| Pengxin International |
Hainan Airlines and Pengxin International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Airlines and Pengxin International
The main advantage of trading using opposite Hainan Airlines and Pengxin International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Airlines position performs unexpectedly, Pengxin International 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 Pengxin International will offset losses from the drop in Pengxin International's long position.| Hainan Airlines vs. BYD Co Ltd | Hainan Airlines vs. China Mobile Limited | Hainan Airlines vs. Agricultural Bank of | Hainan Airlines vs. Industrial and Commercial |
| Pengxin International vs. Zijin Mining Group | Pengxin International vs. Wanhua Chemical Group | Pengxin International vs. Baoshan Iron Steel | Pengxin International vs. Shandong Gold Mining |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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