Correlation Between Asia Aviation and Gunkul Engineering
Can any of the company-specific risk be diversified away by investing in both Asia Aviation and Gunkul Engineering at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Asia Aviation and Gunkul Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Aviation Public and Gunkul Engineering Public, you can compare the effects of market volatilities on Asia Aviation and Gunkul Engineering 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 Asia Aviation with a short position of Gunkul Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Aviation and Gunkul Engineering.
Diversification Opportunities for Asia Aviation and Gunkul Engineering
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Asia and Gunkul is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Asia Aviation Public and Gunkul Engineering Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gunkul Engineering Public and Asia Aviation 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 Asia Aviation Public are associated (or correlated) with Gunkul Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gunkul Engineering Public has no effect on the direction of Asia Aviation i.e., Asia Aviation and Gunkul Engineering go up and down completely randomly.
Pair Corralation between Asia Aviation and Gunkul Engineering
Assuming the 90 days trading horizon Asia Aviation Public is expected to generate 0.77 times more return on investment than Gunkul Engineering. However, Asia Aviation Public is 1.31 times less risky than Gunkul Engineering. It trades about -0.09 of its potential returns per unit of risk. Gunkul Engineering Public is currently generating about -0.33 per unit of risk. If you would invest 290.00 in Asia Aviation Public on August 29, 2024 and sell it today you would lose (10.00) from holding Asia Aviation Public or give up 3.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Aviation Public vs. Gunkul Engineering Public
Performance |
| Timeline |
| Asia Aviation Public |
| Gunkul Engineering Public |
Asia Aviation and Gunkul Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Aviation and Gunkul Engineering
The main advantage of trading using opposite Asia Aviation and Gunkul Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Aviation position performs unexpectedly, Gunkul Engineering 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 Gunkul Engineering will offset losses from the drop in Gunkul Engineering's long position.| Asia Aviation vs. MCS Steel Public | Asia Aviation vs. Asia Plus Group | Asia Aviation vs. Lalin Property Public | Asia Aviation vs. Lam Soon Public |
| Gunkul Engineering vs. MCS Steel Public | Gunkul Engineering vs. Asia Plus Group | Gunkul Engineering vs. Lalin Property Public | Gunkul Engineering vs. Lam Soon Public |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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