Correlation Between CN DATANG and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both CN DATANG 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 CN DATANG and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CN DATANG C and AEGEAN AIRLINES, you can compare the effects of market volatilities on CN DATANG 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 CN DATANG with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of CN DATANG and AEGEAN AIRLINES.
Diversification Opportunities for CN DATANG and AEGEAN AIRLINES
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between DT7 and AEGEAN is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding CN DATANG C and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and CN DATANG 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 CN DATANG C 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 CN DATANG i.e., CN DATANG and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between CN DATANG and AEGEAN AIRLINES
Assuming the 90 days trading horizon CN DATANG C is expected to generate 2.19 times more return on investment than AEGEAN AIRLINES. However, CN DATANG is 2.19 times more volatile than AEGEAN AIRLINES. It trades about 0.04 of its potential returns per unit of risk. AEGEAN AIRLINES is currently generating about 0.07 per unit of risk. If you would invest 14.00 in CN DATANG C on October 16, 2024 and sell it today you would earn a total of 9.00 from holding CN DATANG C or generate 64.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CN DATANG C vs. AEGEAN AIRLINES
Performance |
| Timeline |
| CN DATANG C |
| AEGEAN AIRLINES |
CN DATANG and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CN DATANG and AEGEAN AIRLINES
The main advantage of trading using opposite CN DATANG and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CN DATANG 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.| CN DATANG vs. PICKN PAY STORES | CN DATANG vs. MARKET VECTR RETAIL | CN DATANG vs. ASPEN TECHINC DL | CN DATANG vs. Fast Retailing Co |
| AEGEAN AIRLINES vs. Teradata Corp | AEGEAN AIRLINES vs. Pure Storage | AEGEAN AIRLINES vs. CN DATANG C | AEGEAN AIRLINES vs. Data Modul AG |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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