Correlation Between China Tontine and China Eastern
Can any of the company-specific risk be diversified away by investing in both China Tontine and China Eastern 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 China Tontine and China Eastern into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Tontine Wines and China Eastern Airlines, you can compare the effects of market volatilities on China Tontine and China Eastern 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 China Tontine with a short position of China Eastern. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Tontine and China Eastern.
Diversification Opportunities for China Tontine and China Eastern
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Tontine Wines and China Eastern Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Eastern Airlines and China Tontine 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 China Tontine Wines are associated (or correlated) with China Eastern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Eastern Airlines has no effect on the direction of China Tontine i.e., China Tontine and China Eastern go up and down completely randomly.
Pair Corralation between China Tontine and China Eastern
If you would invest 1,998 in China Eastern Airlines on September 13, 2024 and sell it today you would earn a total of 0.00 from holding China Eastern Airlines or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
China Tontine Wines vs. China Eastern Airlines
Performance |
| Timeline |
| China Tontine Wines |
| China Eastern Airlines |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
China Tontine and China Eastern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Tontine and China Eastern
The main advantage of trading using opposite China Tontine and China Eastern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Tontine position performs unexpectedly, China Eastern 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 Eastern will offset losses from the drop in China Eastern's long position.| China Tontine vs. Andrew Peller Limited | China Tontine vs. Aristocrat Group Corp | China Tontine vs. Iconic Brands | China Tontine vs. Naked Wines plc |
| China Eastern vs. The Coca Cola | China Eastern vs. Anheuser Busch Inbev | China Eastern vs. SNDL Inc | China Eastern vs. Playstudios |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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