Correlation Between Eastern Air and Dongjiang Environmental
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By analyzing existing cross correlation between Eastern Air Logistics and Dongjiang Environmental Co, you can compare the effects of market volatilities on Eastern Air and Dongjiang Environmental 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 Eastern Air with a short position of Dongjiang Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastern Air and Dongjiang Environmental.
Diversification Opportunities for Eastern Air and Dongjiang Environmental
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eastern and Dongjiang is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Eastern Air Logistics and Dongjiang Environmental Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongjiang Environmental and Eastern Air 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 Eastern Air Logistics are associated (or correlated) with Dongjiang Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongjiang Environmental has no effect on the direction of Eastern Air i.e., Eastern Air and Dongjiang Environmental go up and down completely randomly.
Pair Corralation between Eastern Air and Dongjiang Environmental
Assuming the 90 days trading horizon Eastern Air Logistics is expected to under-perform the Dongjiang Environmental. But the stock apears to be less risky and, when comparing its historical volatility, Eastern Air Logistics is 1.08 times less risky than Dongjiang Environmental. The stock trades about -0.04 of its potential returns per unit of risk. The Dongjiang Environmental Co is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 456.00 in Dongjiang Environmental Co on September 3, 2024 and sell it today you would earn a total of 32.00 from holding Dongjiang Environmental Co or generate 7.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastern Air Logistics vs. Dongjiang Environmental Co
Performance |
| Timeline |
| Eastern Air Logistics |
| Dongjiang Environmental |
Eastern Air and Dongjiang Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastern Air and Dongjiang Environmental
The main advantage of trading using opposite Eastern Air and Dongjiang Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastern Air position performs unexpectedly, Dongjiang Environmental 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 Dongjiang Environmental will offset losses from the drop in Dongjiang Environmental's long position.| Eastern Air vs. Fiberhome Telecommunication Technologies | Eastern Air vs. Ningbo Tech Bank Co | Eastern Air vs. Unisplendour Corp | Eastern Air vs. China Construction Bank |
| Dongjiang Environmental vs. Cultural Investment Holdings | Dongjiang Environmental vs. Gome Telecom Equipment | Dongjiang Environmental vs. Bus Online Co | Dongjiang Environmental vs. Holitech Technology Co |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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