Correlation Between Air Link and Pak Gulf
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By analyzing existing cross correlation between Air Link Communication and Pak Gulf Leasing, you can compare the effects of market volatilities on Air Link and Pak Gulf 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 Pak Gulf. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Link and Pak Gulf.
Diversification Opportunities for Air Link and Pak Gulf
Excellent diversification
The 3 months correlation between Air and Pak is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Air Link Communication and Pak Gulf Leasing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pak Gulf Leasing 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 Pak Gulf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pak Gulf Leasing has no effect on the direction of Air Link i.e., Air Link and Pak Gulf go up and down completely randomly.
Pair Corralation between Air Link and Pak Gulf
Assuming the 90 days trading horizon Air Link Communication is expected to generate 0.71 times more return on investment than Pak Gulf. However, Air Link Communication is 1.41 times less risky than Pak Gulf. It trades about 0.12 of its potential returns per unit of risk. Pak Gulf Leasing is currently generating about 0.08 per unit of risk. If you would invest 5,767 in Air Link Communication on August 24, 2024 and sell it today you would earn a total of 7,186 from holding Air Link Communication or generate 124.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 92.56% |
| Values | Daily Returns |
Air Link Communication vs. Pak Gulf Leasing
Performance |
| Timeline |
| Air Link Communication |
| Pak Gulf Leasing |
Air Link and Pak Gulf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Link and Pak Gulf
The main advantage of trading using opposite Air Link and Pak Gulf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Link position performs unexpectedly, Pak Gulf 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 Pak Gulf will offset losses from the drop in Pak Gulf's long position.| Air Link vs. Habib Insurance | Air Link vs. Ghandhara Automobile | Air Link vs. Century Insurance | Air Link vs. Reliance Weaving Mills |
| Pak Gulf vs. Century Insurance | Pak Gulf vs. Air Link Communication | Pak Gulf vs. Adamjee Insurance | Pak Gulf vs. Habib Insurance |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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