Correlation Between Ehang Holdings and Boeing
Can any of the company-specific risk be diversified away by investing in both Ehang Holdings and Boeing 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 Ehang Holdings and Boeing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ehang Holdings and The Boeing, you can compare the effects of market volatilities on Ehang Holdings and Boeing 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 Ehang Holdings with a short position of Boeing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ehang Holdings and Boeing.
Diversification Opportunities for Ehang Holdings and Boeing
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ehang and Boeing is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ehang Holdings and The Boeing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boeing and Ehang Holdings 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 Ehang Holdings are associated (or correlated) with Boeing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boeing has no effect on the direction of Ehang Holdings i.e., Ehang Holdings and Boeing go up and down completely randomly.
Pair Corralation between Ehang Holdings and Boeing
Allowing for the 90-day total investment horizon Ehang Holdings is expected to generate 2.42 times more return on investment than Boeing. However, Ehang Holdings is 2.42 times more volatile than The Boeing. It trades about 0.01 of its potential returns per unit of risk. The Boeing is currently generating about -0.07 per unit of risk. If you would invest 1,761 in Ehang Holdings on August 26, 2024 and sell it today you would lose (355.00) from holding Ehang Holdings or give up 20.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ehang Holdings vs. The Boeing
Performance |
| Timeline |
| Ehang Holdings |
| Boeing |
Ehang Holdings and Boeing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ehang Holdings and Boeing
The main advantage of trading using opposite Ehang Holdings and Boeing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ehang Holdings position performs unexpectedly, Boeing 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 Boeing will offset losses from the drop in Boeing's long position.| Ehang Holdings vs. Redwire Corp | Ehang Holdings vs. Sidus Space | Ehang Holdings vs. Rocket Lab USA | Ehang Holdings vs. Momentus |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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