Correlation Between Bank of China and Air China
Specify exactly 2 symbols:
By analyzing existing cross correlation between Bank of China and Air China Ltd, you can compare the effects of market volatilities on Bank of China and Air China 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 Bank of China with a short position of Air China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Air China.
Diversification Opportunities for Bank of China and Air China
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Air is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Air China Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air China and Bank of 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 Bank of China are associated (or correlated) with Air China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air China has no effect on the direction of Bank of China i.e., Bank of China and Air China go up and down completely randomly.
Pair Corralation between Bank of China and Air China
Assuming the 90 days trading horizon Bank of China is expected to generate 0.79 times more return on investment than Air China. However, Bank of China is 1.27 times less risky than Air China. It trades about 0.09 of its potential returns per unit of risk. Air China Ltd is currently generating about -0.04 per unit of risk. If you would invest 296.00 in Bank of China on September 5, 2024 and sell it today you would earn a total of 213.00 from holding Bank of China or generate 71.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. Air China Ltd
Performance |
| Timeline |
| Bank of China |
| Air China |
Bank of China and Air China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Air China
The main advantage of trading using opposite Bank of China and Air China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Air China 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 Air China will offset losses from the drop in Air China's long position.| Bank of China vs. Jafron Biomedical Co | Bank of China vs. Dezhan HealthCare Co | Bank of China vs. Ningbo Ligong Online | Bank of China vs. Guangzhou Boji Medical |
| Air China vs. Agricultural Bank of | Air China vs. Industrial and Commercial | Air China vs. Bank of China | Air China vs. China Construction Bank |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |