Correlation Between Eastern Air and China National
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By analyzing existing cross correlation between Eastern Air Logistics and China National Software, you can compare the effects of market volatilities on Eastern Air and China National 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 China National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastern Air and China National.
Diversification Opportunities for Eastern Air and China National
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eastern and China is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Eastern Air Logistics and China National Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China National Software 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 China National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China National Software has no effect on the direction of Eastern Air i.e., Eastern Air and China National go up and down completely randomly.
Pair Corralation between Eastern Air and China National
Assuming the 90 days trading horizon Eastern Air is expected to generate 12.52 times less return on investment than China National. But when comparing it to its historical volatility, Eastern Air Logistics is 1.9 times less risky than China National. It trades about 0.03 of its potential returns per unit of risk. China National Software is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 3,303 in China National Software on September 12, 2024 and sell it today you would earn a total of 2,143 from holding China National Software or generate 64.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.28% |
| Values | Daily Returns |
Eastern Air Logistics vs. China National Software
Performance |
| Timeline |
| Eastern Air Logistics |
| China National Software |
Eastern Air and China National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastern Air and China National
The main advantage of trading using opposite Eastern Air and China National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastern Air position performs unexpectedly, China National 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 China National will offset losses from the drop in China National's long position.| Eastern Air vs. Thinkingdom Media Group | Eastern Air vs. State Grid InformationCommunication | Eastern Air vs. Digital China Information | Eastern Air vs. Beijing Bashi Media |
| China National vs. Ming Yang Smart | China National vs. 159681 | China National vs. 159005 | China National 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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