Correlation Between Sichuan Hebang and Air China
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By analyzing existing cross correlation between Sichuan Hebang Biotechnology and Air China Ltd, you can compare the effects of market volatilities on Sichuan Hebang 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 Sichuan Hebang with a short position of Air China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Hebang and Air China.
Diversification Opportunities for Sichuan Hebang and Air China
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sichuan and Air is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Hebang Biotechnology and Air China Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air China and Sichuan Hebang 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 Sichuan Hebang Biotechnology 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 Sichuan Hebang i.e., Sichuan Hebang and Air China go up and down completely randomly.
Pair Corralation between Sichuan Hebang and Air China
Assuming the 90 days trading horizon Sichuan Hebang Biotechnology is expected to generate 1.22 times more return on investment than Air China. However, Sichuan Hebang is 1.22 times more volatile than Air China Ltd. It trades about 0.09 of its potential returns per unit of risk. Air China Ltd is currently generating about -0.03 per unit of risk. If you would invest 201.00 in Sichuan Hebang Biotechnology on September 28, 2024 and sell it today you would earn a total of 10.00 from holding Sichuan Hebang Biotechnology or generate 4.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Hebang Biotechnology vs. Air China Ltd
Performance |
| Timeline |
| Sichuan Hebang Biote |
| Air China |
Sichuan Hebang and Air China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Hebang and Air China
The main advantage of trading using opposite Sichuan Hebang and Air China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Hebang 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.| Sichuan Hebang vs. Beijing Kaiwen Education | Sichuan Hebang vs. Shanghai Sanyou Medical | Sichuan Hebang vs. Xiangyu Medical Co | Sichuan Hebang vs. Northern United Publishing |
| Air China vs. Industrial and Commercial | Air China vs. Agricultural Bank of | Air China vs. China Construction Bank | Air China 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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