Correlation Between Inspur Software and China Eastern
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By analyzing existing cross correlation between Inspur Software Co and China Eastern Airlines, you can compare the effects of market volatilities on Inspur Software and China Eastern 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 Inspur Software with a short position of China Eastern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inspur Software and China Eastern.
Diversification Opportunities for Inspur Software and China Eastern
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inspur and China is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Inspur Software Co and China Eastern Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Eastern Airlines and Inspur Software 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 Inspur Software Co are associated (or correlated) with China Eastern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Eastern Airlines has no effect on the direction of Inspur Software i.e., Inspur Software and China Eastern go up and down completely randomly.
Pair Corralation between Inspur Software and China Eastern
Assuming the 90 days trading horizon Inspur Software Co is expected to generate 1.97 times more return on investment than China Eastern. However, Inspur Software is 1.97 times more volatile than China Eastern Airlines. It trades about 0.02 of its potential returns per unit of risk. China Eastern Airlines is currently generating about -0.01 per unit of risk. If you would invest 1,556 in Inspur Software Co on September 12, 2024 and sell it today you would earn a total of 61.00 from holding Inspur Software Co or generate 3.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inspur Software Co vs. China Eastern Airlines
Performance |
| Timeline |
| Inspur Software |
| China Eastern Airlines |
Inspur Software and China Eastern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inspur Software and China Eastern
The main advantage of trading using opposite Inspur Software and China Eastern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inspur Software position performs unexpectedly, China Eastern 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 China Eastern will offset losses from the drop in China Eastern's long position.| Inspur Software vs. Liaoning Chengda Biotechnology | Inspur Software vs. Yingde Greatchem Chemicals | Inspur Software vs. Jiahe Foods Industry | Inspur Software vs. Guangdong Wens Foodstuff |
| China Eastern vs. Anhui Transport Consulting | China Eastern vs. Suzhou Douson Drilling | China Eastern vs. Chengdu Spaceon Electronics | China Eastern vs. Guangdong Jingyi Metal |
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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