Correlation Between Hainan Airlines and Fibocom Wireless
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By analyzing existing cross correlation between Hainan Airlines Co and Fibocom Wireless, you can compare the effects of market volatilities on Hainan Airlines and Fibocom Wireless 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 Hainan Airlines with a short position of Fibocom Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Airlines and Fibocom Wireless.
Diversification Opportunities for Hainan Airlines and Fibocom Wireless
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hainan and Fibocom is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Airlines Co and Fibocom Wireless in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fibocom Wireless and Hainan Airlines 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 Hainan Airlines Co are associated (or correlated) with Fibocom Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fibocom Wireless has no effect on the direction of Hainan Airlines i.e., Hainan Airlines and Fibocom Wireless go up and down completely randomly.
Pair Corralation between Hainan Airlines and Fibocom Wireless
Assuming the 90 days trading horizon Hainan Airlines is expected to generate 4.67 times less return on investment than Fibocom Wireless. But when comparing it to its historical volatility, Hainan Airlines Co is 1.75 times less risky than Fibocom Wireless. It trades about 0.01 of its potential returns per unit of risk. Fibocom Wireless is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,834 in Fibocom Wireless on October 16, 2024 and sell it today you would earn a total of 23.00 from holding Fibocom Wireless or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hainan Airlines Co vs. Fibocom Wireless
Performance |
| Timeline |
| Hainan Airlines |
| Fibocom Wireless |
Hainan Airlines and Fibocom Wireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Airlines and Fibocom Wireless
The main advantage of trading using opposite Hainan Airlines and Fibocom Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Airlines position performs unexpectedly, Fibocom Wireless 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 Fibocom Wireless will offset losses from the drop in Fibocom Wireless' long position.| Hainan Airlines vs. Lootom Telcovideo Network | Hainan Airlines vs. Holitech Technology Co | Hainan Airlines vs. Zhejiang Kingland Pipeline | Hainan Airlines vs. Fujian Wanchen Biotechnology |
| Fibocom Wireless vs. Xiangyang Automobile Bearing | Fibocom Wireless vs. Yingde Greatchem Chemicals | Fibocom Wireless vs. Do Fluoride Chemicals Co | Fibocom Wireless vs. Yindu Kitchen Equipment |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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