Correlation Between Air China and Cinda Securities
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By analyzing existing cross correlation between Air China Ltd and Cinda Securities Co, you can compare the effects of market volatilities on Air China and Cinda Securities 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 Cinda Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air China and Cinda Securities.
Diversification Opportunities for Air China and Cinda Securities
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Air and Cinda is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Air China Ltd and Cinda Securities Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cinda Securities 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 Cinda Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cinda Securities has no effect on the direction of Air China i.e., Air China and Cinda Securities go up and down completely randomly.
Pair Corralation between Air China and Cinda Securities
Assuming the 90 days trading horizon Air China Ltd is expected to generate 0.95 times more return on investment than Cinda Securities. However, Air China Ltd is 1.06 times less risky than Cinda Securities. It trades about 0.39 of its potential returns per unit of risk. Cinda Securities Co is currently generating about -0.04 per unit of risk. If you would invest 743.00 in Air China Ltd on September 14, 2024 and sell it today you would earn a total of 136.00 from holding Air China Ltd or generate 18.3% 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. Cinda Securities Co
Performance |
| Timeline |
| Air China |
| Cinda Securities |
Air China and Cinda Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air China and Cinda Securities
The main advantage of trading using opposite Air China and Cinda Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air China position performs unexpectedly, Cinda Securities 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 Cinda Securities will offset losses from the drop in Cinda Securities' long position.| Air China vs. China State Construction | Air China vs. Poly Real Estate | Air China vs. China Vanke Co | Air China vs. China Merchants Shekou |
| Cinda Securities vs. Chison Medical Technologies | Cinda Securities vs. Eastern Air Logistics | Cinda Securities vs. Hangzhou Gisway Information | Cinda Securities vs. Air China Ltd |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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