Correlation Between Air Link and Ghani Chemical
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By analyzing existing cross correlation between Air Link Communication and Ghani Chemical Industries, you can compare the effects of market volatilities on Air Link and Ghani Chemical 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 Air Link with a short position of Ghani Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Link and Ghani Chemical.
Diversification Opportunities for Air Link and Ghani Chemical
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Air and Ghani is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Air Link Communication and Ghani Chemical Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ghani Chemical Industries and Air Link 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 Air Link Communication are associated (or correlated) with Ghani Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ghani Chemical Industries has no effect on the direction of Air Link i.e., Air Link and Ghani Chemical go up and down completely randomly.
Pair Corralation between Air Link and Ghani Chemical
Assuming the 90 days trading horizon Air Link Communication is expected to generate 1.12 times more return on investment than Ghani Chemical. However, Air Link is 1.12 times more volatile than Ghani Chemical Industries. It trades about 0.16 of its potential returns per unit of risk. Ghani Chemical Industries is currently generating about 0.08 per unit of risk. If you would invest 3,551 in Air Link Communication on August 25, 2024 and sell it today you would earn a total of 9,355 from holding Air Link Communication or generate 263.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Air Link Communication vs. Ghani Chemical Industries
Performance |
Timeline |
Air Link Communication |
Ghani Chemical Industries |
Air Link and Ghani Chemical Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Air Link and Ghani Chemical
The main advantage of trading using opposite Air Link and Ghani Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Link position performs unexpectedly, Ghani Chemical 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 Ghani Chemical will offset losses from the drop in Ghani Chemical's long position.Air Link vs. Pak Gulf Leasing | Air Link vs. Grays Leasing | Air Link vs. Askari Bank | Air Link vs. National Bank of |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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