Correlation Between Snap and Airnet Technology
Can any of the company-specific risk be diversified away by investing in both Snap and Airnet Technology 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 Snap and Airnet Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Airnet Technology, you can compare the effects of market volatilities on Snap and Airnet Technology 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 Snap with a short position of Airnet Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Airnet Technology.
Diversification Opportunities for Snap and Airnet Technology
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Snap and Airnet is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and Airnet Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airnet Technology and Snap 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 Snap Inc are associated (or correlated) with Airnet Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airnet Technology has no effect on the direction of Snap i.e., Snap and Airnet Technology go up and down completely randomly.
Pair Corralation between Snap and Airnet Technology
Given the investment horizon of 90 days Snap is expected to generate 2.78 times less return on investment than Airnet Technology. But when comparing it to its historical volatility, Snap Inc is 2.27 times less risky than Airnet Technology. It trades about 0.02 of its potential returns per unit of risk. Airnet Technology is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 162.00 in Airnet Technology on August 24, 2024 and sell it today you would lose (109.00) from holding Airnet Technology or give up 67.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.52% |
| Values | Daily Returns |
Snap Inc vs. Airnet Technology
Performance |
| Timeline |
| Snap Inc |
| Airnet Technology |
Snap and Airnet Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Airnet Technology
The main advantage of trading using opposite Snap and Airnet Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, Airnet Technology 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 Airnet Technology will offset losses from the drop in Airnet Technology's long position.The idea behind Snap Inc and Airnet Technology 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.| Airnet Technology vs. ATIF Holdings | Airnet Technology vs. Mercurity Fintech Holding | Airnet Technology vs. Taoping | Airnet Technology vs. Datasea |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |