Correlation Between Integral and China Southern
Can any of the company-specific risk be diversified away by investing in both Integral and China Southern 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 Integral and China Southern into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Integral Ad Science and China Southern Airlines, you can compare the effects of market volatilities on Integral and China Southern 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 Integral with a short position of China Southern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Integral and China Southern.
Diversification Opportunities for Integral and China Southern
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Integral and China is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Integral Ad Science and China Southern Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Southern Airlines and Integral 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 Integral Ad Science are associated (or correlated) with China Southern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Southern Airlines has no effect on the direction of Integral i.e., Integral and China Southern go up and down completely randomly.
Pair Corralation between Integral and China Southern
If you would invest 3,697 in China Southern Airlines on September 12, 2024 and sell it today you would earn a total of 0.00 from holding China Southern Airlines or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.4% |
| Values | Daily Returns |
Integral Ad Science vs. China Southern Airlines
Performance |
| Timeline |
| Integral Ad Science |
| China Southern Airlines |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Integral and China Southern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Integral and China Southern
The main advantage of trading using opposite Integral and China Southern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Integral position performs unexpectedly, China Southern 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 China Southern will offset losses from the drop in China Southern's long position.The idea behind Integral Ad Science and China Southern Airlines pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| China Southern vs. Zhihu Inc ADR | China Southern vs. Integral Ad Science | China Southern vs. Pinterest | China Southern vs. Analog Devices |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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