Correlation Between Air China and Tieling Newcity
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By analyzing existing cross correlation between Air China Ltd and Tieling Newcity Investment, you can compare the effects of market volatilities on Air China and Tieling Newcity 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 Air China with a short position of Tieling Newcity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air China and Tieling Newcity.
Diversification Opportunities for Air China and Tieling Newcity
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Air and Tieling is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Air China Ltd and Tieling Newcity Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tieling Newcity Inve and Air China 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 Air China Ltd are associated (or correlated) with Tieling Newcity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tieling Newcity Inve has no effect on the direction of Air China i.e., Air China and Tieling Newcity go up and down completely randomly.
Pair Corralation between Air China and Tieling Newcity
Assuming the 90 days trading horizon Air China Ltd is expected to generate 0.6 times more return on investment than Tieling Newcity. However, Air China Ltd is 1.67 times less risky than Tieling Newcity. It trades about 0.28 of its potential returns per unit of risk. Tieling Newcity Investment is currently generating about 0.17 per unit of risk. If you would invest 722.00 in Air China Ltd on August 29, 2024 and sell it today you would earn a total of 72.00 from holding Air China Ltd or generate 9.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air China Ltd vs. Tieling Newcity Investment
Performance |
| Timeline |
| Air China |
| Tieling Newcity Inve |
Air China and Tieling Newcity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air China and Tieling Newcity
The main advantage of trading using opposite Air China and Tieling Newcity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air China position performs unexpectedly, Tieling Newcity 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 Tieling Newcity will offset losses from the drop in Tieling Newcity's long position.| Air China vs. BYD Co Ltd | Air China vs. China Mobile Limited | Air China vs. Agricultural Bank of | Air China vs. Industrial and Commercial |
| Tieling Newcity vs. Fiberhome Telecommunication Technologies | Tieling Newcity vs. Tongyu Communication | Tieling Newcity vs. Eastern Communications Co | Tieling Newcity vs. Nanjing Putian Telecommunications |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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