Correlation Between China Clean and Finnair Oyj
Can any of the company-specific risk be diversified away by investing in both China Clean and Finnair Oyj 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 Clean and Finnair Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Clean Energy and Finnair Oyj, you can compare the effects of market volatilities on China Clean and Finnair Oyj 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 Clean with a short position of Finnair Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Clean and Finnair Oyj.
Diversification Opportunities for China Clean and Finnair Oyj
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Finnair is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Clean Energy and Finnair Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finnair Oyj and China Clean 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 Clean Energy are associated (or correlated) with Finnair Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finnair Oyj has no effect on the direction of China Clean i.e., China Clean and Finnair Oyj go up and down completely randomly.
Pair Corralation between China Clean and Finnair Oyj
If you would invest 0.01 in China Clean Energy on August 31, 2024 and sell it today you would earn a total of 0.00 from holding China Clean Energy or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Clean Energy vs. Finnair Oyj
Performance |
| Timeline |
| China Clean Energy |
| Finnair Oyj |
China Clean and Finnair Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Clean and Finnair Oyj
The main advantage of trading using opposite China Clean and Finnair Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Clean position performs unexpectedly, Finnair Oyj 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 Finnair Oyj will offset losses from the drop in Finnair Oyj's long position.| China Clean vs. Sherwin Williams Co | China Clean vs. Air Liquide SA | China Clean vs. LAir Liquide SA | China Clean vs. Air Products and |
| Finnair Oyj vs. Copa Holdings SA | Finnair Oyj vs. United Airlines Holdings | Finnair Oyj vs. Delta Air Lines | Finnair Oyj vs. SkyWest |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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