Correlation Between Air Lease and WUXI BIOLOGICS
Can any of the company-specific risk be diversified away by investing in both Air Lease and WUXI BIOLOGICS 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 Air Lease and WUXI BIOLOGICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Lease and WUXI BIOLOGICS UNSPADR2, you can compare the effects of market volatilities on Air Lease and WUXI BIOLOGICS 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 Lease with a short position of WUXI BIOLOGICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Lease and WUXI BIOLOGICS.
Diversification Opportunities for Air Lease and WUXI BIOLOGICS
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Air and WUXI is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Air Lease and WUXI BIOLOGICS UNSPADR2 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WUXI BIOLOGICS UNSPADR2 and Air Lease 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 Lease are associated (or correlated) with WUXI BIOLOGICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WUXI BIOLOGICS UNSPADR2 has no effect on the direction of Air Lease i.e., Air Lease and WUXI BIOLOGICS go up and down completely randomly.
Pair Corralation between Air Lease and WUXI BIOLOGICS
Assuming the 90 days trading horizon Air Lease is expected to generate 0.52 times more return on investment than WUXI BIOLOGICS. However, Air Lease is 1.92 times less risky than WUXI BIOLOGICS. It trades about 0.37 of its potential returns per unit of risk. WUXI BIOLOGICS UNSPADR2 is currently generating about -0.05 per unit of risk. If you would invest 4,040 in Air Lease on September 1, 2024 and sell it today you would earn a total of 720.00 from holding Air Lease or generate 17.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Air Lease vs. WUXI BIOLOGICS UNSPADR2
Performance |
| Timeline |
| Air Lease |
| WUXI BIOLOGICS UNSPADR2 |
Air Lease and WUXI BIOLOGICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Lease and WUXI BIOLOGICS
The main advantage of trading using opposite Air Lease and WUXI BIOLOGICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Lease position performs unexpectedly, WUXI BIOLOGICS 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 WUXI BIOLOGICS will offset losses from the drop in WUXI BIOLOGICS's long position.| Air Lease vs. Caseys General Stores | Air Lease vs. Ping An Insurance | Air Lease vs. Selective Insurance Group | Air Lease vs. The Hanover Insurance |
| WUXI BIOLOGICS vs. Superior Plus Corp | WUXI BIOLOGICS vs. NMI Holdings | WUXI BIOLOGICS vs. Origin Agritech | WUXI BIOLOGICS vs. SIVERS SEMICONDUCTORS AB |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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