Correlation Between Yanzhou Coal and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both Yanzhou Coal 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 Yanzhou Coal and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yanzhou Coal Mining and AEGEAN AIRLINES, you can compare the effects of market volatilities on Yanzhou Coal 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 Yanzhou Coal with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yanzhou Coal and AEGEAN AIRLINES.
Diversification Opportunities for Yanzhou Coal and AEGEAN AIRLINES
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Yanzhou and AEGEAN is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Yanzhou Coal Mining and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and Yanzhou Coal 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 Yanzhou Coal Mining 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 Yanzhou Coal i.e., Yanzhou Coal and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between Yanzhou Coal and AEGEAN AIRLINES
Assuming the 90 days horizon Yanzhou Coal Mining is expected to under-perform the AEGEAN AIRLINES. But the stock apears to be less risky and, when comparing its historical volatility, Yanzhou Coal Mining is 1.04 times less risky than AEGEAN AIRLINES. The stock trades about -0.18 of its potential returns per unit of risk. The AEGEAN AIRLINES is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,024 in AEGEAN AIRLINES on November 7, 2024 and sell it today you would lose (1.00) from holding AEGEAN AIRLINES or give up 0.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Yanzhou Coal Mining vs. AEGEAN AIRLINES
Performance |
| Timeline |
| Yanzhou Coal Mining |
| AEGEAN AIRLINES |
Yanzhou Coal and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yanzhou Coal and AEGEAN AIRLINES
The main advantage of trading using opposite Yanzhou Coal and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yanzhou Coal 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.| Yanzhou Coal vs. Pure Storage | Yanzhou Coal vs. DATATEC LTD 2 | Yanzhou Coal vs. CeoTronics AG | Yanzhou Coal vs. Datadog |
| AEGEAN AIRLINES vs. Apple Inc | AEGEAN AIRLINES vs. Apple Inc | AEGEAN AIRLINES vs. Apple Inc | AEGEAN AIRLINES vs. Apple Inc |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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