Correlation Between The9 and Air Products
Can any of the company-specific risk be diversified away by investing in both The9 and Air Products 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 The9 and Air Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The9 Ltd ADR and Air Products and, you can compare the effects of market volatilities on The9 and Air Products 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 The9 with a short position of Air Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of The9 and Air Products.
Diversification Opportunities for The9 and Air Products
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between The9 and Air is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding The9 Ltd ADR and Air Products and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Products and The9 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 The9 Ltd ADR are associated (or correlated) with Air Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Products has no effect on the direction of The9 i.e., The9 and Air Products go up and down completely randomly.
Pair Corralation between The9 and Air Products
Given the investment horizon of 90 days The9 Ltd ADR is expected to generate 6.5 times more return on investment than Air Products. However, The9 is 6.5 times more volatile than Air Products and. It trades about 0.33 of its potential returns per unit of risk. Air Products and is currently generating about 0.31 per unit of risk. If you would invest 879.00 in The9 Ltd ADR on August 31, 2024 and sell it today you would earn a total of 453.00 from holding The9 Ltd ADR or generate 51.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The9 Ltd ADR vs. Air Products and
Performance |
| Timeline |
| The9 Ltd ADR |
| Air Products |
The9 and Air Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The9 and Air Products
The main advantage of trading using opposite The9 and Air Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The9 position performs unexpectedly, Air Products 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 Air Products will offset losses from the drop in Air Products' long position.| The9 vs. Atari SA | The9 vs. Victory Square Technologies | The9 vs. Motorsport Gaming Us | The9 vs. Alpha Esports Tech |
| Air Products vs. Eastman Chemical | Air Products vs. Linde plc Ordinary | Air Products vs. Ecolab Inc | Air Products vs. Sherwin Williams Co |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |