Correlation Between Eastern Air and Shuhua Sports
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By analyzing existing cross correlation between Eastern Air Logistics and Shuhua Sports Co, you can compare the effects of market volatilities on Eastern Air and Shuhua Sports 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 Shuhua Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastern Air and Shuhua Sports.
Diversification Opportunities for Eastern Air and Shuhua Sports
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eastern and Shuhua is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Eastern Air Logistics and Shuhua Sports Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shuhua Sports 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 Shuhua Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shuhua Sports has no effect on the direction of Eastern Air i.e., Eastern Air and Shuhua Sports go up and down completely randomly.
Pair Corralation between Eastern Air and Shuhua Sports
Assuming the 90 days trading horizon Eastern Air Logistics is expected to under-perform the Shuhua Sports. But the stock apears to be less risky and, when comparing its historical volatility, Eastern Air Logistics is 1.21 times less risky than Shuhua Sports. The stock trades about -0.24 of its potential returns per unit of risk. The Shuhua Sports Co is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 758.00 in Shuhua Sports Co on September 1, 2024 and sell it today you would earn a total of 101.00 from holding Shuhua Sports Co or generate 13.32% 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. Shuhua Sports Co
Performance |
| Timeline |
| Eastern Air Logistics |
| Shuhua Sports |
Eastern Air and Shuhua Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastern Air and Shuhua Sports
The main advantage of trading using opposite Eastern Air and Shuhua Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastern Air position performs unexpectedly, Shuhua Sports 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 Shuhua Sports will offset losses from the drop in Shuhua Sports' long position.| Eastern Air vs. Tianjin Silvery Dragon | Eastern Air vs. Keeson Technology Corp | Eastern Air vs. Fujian Oriental Silver | Eastern Air vs. Xinjiang Baodi Mining |
| Shuhua Sports vs. Industrial and Commercial | Shuhua Sports vs. Agricultural Bank of | Shuhua Sports vs. China Construction Bank | Shuhua Sports vs. Bank of China |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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