Correlation Between Air China and Jahen Household
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By analyzing existing cross correlation between Air China Ltd and Jahen Household Products, you can compare the effects of market volatilities on Air China and Jahen Household 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 Jahen Household. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air China and Jahen Household.
Diversification Opportunities for Air China and Jahen Household
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Air and Jahen is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Air China Ltd and Jahen Household Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jahen Household Products 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 Jahen Household. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jahen Household Products has no effect on the direction of Air China i.e., Air China and Jahen Household go up and down completely randomly.
Pair Corralation between Air China and Jahen Household
Assuming the 90 days trading horizon Air China is expected to generate 1.39 times less return on investment than Jahen Household. But when comparing it to its historical volatility, Air China Ltd is 1.76 times less risky than Jahen Household. It trades about 0.05 of its potential returns per unit of risk. Jahen Household Products is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,578 in Jahen Household Products on September 5, 2024 and sell it today you would earn a total of 56.00 from holding Jahen Household Products or generate 3.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.62% |
| Values | Daily Returns |
Air China Ltd vs. Jahen Household Products
Performance |
| Timeline |
| Air China |
| Jahen Household Products |
Air China and Jahen Household Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air China and Jahen Household
The main advantage of trading using opposite Air China and Jahen Household positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air China position performs unexpectedly, Jahen Household 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 Jahen Household will offset losses from the drop in Jahen Household's long position.| Air China vs. Agricultural Bank of | Air China vs. Industrial and Commercial | Air China vs. Bank of China | Air China vs. China Construction Bank |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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