Correlation Between Chuangs China and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both Chuangs China and AEGEAN AIRLINES 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 Chuangs China and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chuangs China Investments and AEGEAN AIRLINES, you can compare the effects of market volatilities on Chuangs China and AEGEAN AIRLINES 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 Chuangs China with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chuangs China and AEGEAN AIRLINES.
Diversification Opportunities for Chuangs China and AEGEAN AIRLINES
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chuangs and AEGEAN is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Chuangs China Investments and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and Chuangs China 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 Chuangs China Investments are associated (or correlated) with AEGEAN AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEGEAN AIRLINES has no effect on the direction of Chuangs China i.e., Chuangs China and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between Chuangs China and AEGEAN AIRLINES
If you would invest 1.00 in Chuangs China Investments on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Chuangs China Investments or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chuangs China Investments vs. AEGEAN AIRLINES
Performance |
| Timeline |
| Chuangs China Investments |
| AEGEAN AIRLINES |
Chuangs China and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chuangs China and AEGEAN AIRLINES
The main advantage of trading using opposite Chuangs China and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chuangs China position performs unexpectedly, AEGEAN AIRLINES 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 AEGEAN AIRLINES will offset losses from the drop in AEGEAN AIRLINES's long position.| Chuangs China vs. Superior Plus Corp | Chuangs China vs. NMI Holdings | Chuangs China vs. Origin Agritech | Chuangs China vs. SIVERS SEMICONDUCTORS AB |
| AEGEAN AIRLINES vs. COMBA TELECOM SYST | AEGEAN AIRLINES vs. Rogers Communications | AEGEAN AIRLINES vs. INTERSHOP Communications Aktiengesellschaft | AEGEAN AIRLINES vs. China Communications Services |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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