Correlation Between Archer Aviation and China Health
Can any of the company-specific risk be diversified away by investing in both Archer Aviation and China Health 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 Archer Aviation and China Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Archer Aviation and China Health Management, you can compare the effects of market volatilities on Archer Aviation and China Health 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 Archer Aviation with a short position of China Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Archer Aviation and China Health.
Diversification Opportunities for Archer Aviation and China Health
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Archer and China is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Archer Aviation and China Health Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Health Management and Archer 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 Archer Aviation are associated (or correlated) with China Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Health Management has no effect on the direction of Archer Aviation i.e., Archer Aviation and China Health go up and down completely randomly.
Pair Corralation between Archer Aviation and China Health
Given the investment horizon of 90 days Archer Aviation is expected to generate 0.57 times more return on investment than China Health. However, Archer Aviation is 1.75 times less risky than China Health. It trades about 0.07 of its potential returns per unit of risk. China Health Management is currently generating about 0.02 per unit of risk. If you would invest 506.00 in Archer Aviation on November 2, 2024 and sell it today you would earn a total of 439.00 from holding Archer Aviation or generate 86.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Archer Aviation vs. China Health Management
Performance |
| Timeline |
| Archer Aviation |
| China Health Management |
Archer Aviation and China Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Archer Aviation and China Health
The main advantage of trading using opposite Archer Aviation and China Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Archer Aviation position performs unexpectedly, China Health 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 China Health will offset losses from the drop in China Health's long position.| Archer Aviation vs. Vertical Aerospace | Archer Aviation vs. Ehang Holdings | Archer Aviation vs. Rocket Lab USA | Archer Aviation vs. Lilium NV |
| China Health vs. Absolute Health and | China Health vs. Embrace Change Acquisition | China Health vs. Supurva Healthcare Group | China Health vs. TransAKT |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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