Correlation Between Spring Airlines and Ningbo Construction
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By analyzing existing cross correlation between Spring Airlines Co and Ningbo Construction Co, you can compare the effects of market volatilities on Spring Airlines and Ningbo Construction 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 Spring Airlines with a short position of Ningbo Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spring Airlines and Ningbo Construction.
Diversification Opportunities for Spring Airlines and Ningbo Construction
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Spring and Ningbo is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Spring Airlines Co and Ningbo Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Construction and Spring 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 Spring Airlines Co are associated (or correlated) with Ningbo Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Construction has no effect on the direction of Spring Airlines i.e., Spring Airlines and Ningbo Construction go up and down completely randomly.
Pair Corralation between Spring Airlines and Ningbo Construction
Assuming the 90 days trading horizon Spring Airlines is expected to generate 5.76 times less return on investment than Ningbo Construction. But when comparing it to its historical volatility, Spring Airlines Co is 2.52 times less risky than Ningbo Construction. It trades about 0.04 of its potential returns per unit of risk. Ningbo Construction Co is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 428.00 in Ningbo Construction Co on August 29, 2024 and sell it today you would earn a total of 30.00 from holding Ningbo Construction Co or generate 7.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spring Airlines Co vs. Ningbo Construction Co
Performance |
| Timeline |
| Spring Airlines |
| Ningbo Construction |
Spring Airlines and Ningbo Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spring Airlines and Ningbo Construction
The main advantage of trading using opposite Spring Airlines and Ningbo Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spring Airlines position performs unexpectedly, Ningbo Construction 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 Ningbo Construction will offset losses from the drop in Ningbo Construction's long position.| Spring Airlines vs. BYD Co Ltd | Spring Airlines vs. China Mobile Limited | Spring Airlines vs. Agricultural Bank of | Spring Airlines vs. Industrial and Commercial |
| Ningbo Construction vs. Ming Yang Smart | Ningbo Construction vs. 159681 | Ningbo Construction vs. 159005 | Ningbo Construction vs. Loctek Ergonomic Technology |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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