Correlation Between Cheer Holding and Airnet Technology
Can any of the company-specific risk be diversified away by investing in both Cheer Holding and Airnet Technology 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 Cheer Holding and Airnet Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cheer Holding and Airnet Technology, you can compare the effects of market volatilities on Cheer Holding and Airnet Technology 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 Cheer Holding with a short position of Airnet Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheer Holding and Airnet Technology.
Diversification Opportunities for Cheer Holding and Airnet Technology
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cheer and Airnet is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Cheer Holding and Airnet Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airnet Technology and Cheer Holding 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 Cheer Holding are associated (or correlated) with Airnet Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airnet Technology has no effect on the direction of Cheer Holding i.e., Cheer Holding and Airnet Technology go up and down completely randomly.
Pair Corralation between Cheer Holding and Airnet Technology
Considering the 90-day investment horizon Cheer Holding is expected to under-perform the Airnet Technology. But the stock apears to be less risky and, when comparing its historical volatility, Cheer Holding is 2.52 times less risky than Airnet Technology. The stock trades about -0.01 of its potential returns per unit of risk. The Airnet Technology is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 60.00 in Airnet Technology on August 24, 2024 and sell it today you would lose (11.00) from holding Airnet Technology or give up 18.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.2% |
| Values | Daily Returns |
Cheer Holding vs. Airnet Technology
Performance |
| Timeline |
| Cheer Holding |
| Airnet Technology |
Cheer Holding and Airnet Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheer Holding and Airnet Technology
The main advantage of trading using opposite Cheer Holding and Airnet Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheer Holding position performs unexpectedly, Airnet Technology 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 Airnet Technology will offset losses from the drop in Airnet Technology's long position.| Cheer Holding vs. First Ship Lease | Cheer Holding vs. Tarsus Pharmaceuticals | Cheer Holding vs. Inhibrx | Cheer Holding vs. Abcellera Biologics |
| Airnet Technology vs. ATIF Holdings | Airnet Technology vs. Mercurity Fintech Holding | Airnet Technology vs. Taoping | Airnet Technology vs. Datasea |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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