Correlation Between Eastern Air and Eastroc Beverage
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By analyzing existing cross correlation between Eastern Air Logistics and Eastroc Beverage Group, you can compare the effects of market volatilities on Eastern Air and Eastroc Beverage 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 Eastern Air with a short position of Eastroc Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastern Air and Eastroc Beverage.
Diversification Opportunities for Eastern Air and Eastroc Beverage
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eastern and Eastroc is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Eastern Air Logistics and Eastroc Beverage Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastroc Beverage and Eastern Air 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 Eastern Air Logistics are associated (or correlated) with Eastroc Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastroc Beverage has no effect on the direction of Eastern Air i.e., Eastern Air and Eastroc Beverage go up and down completely randomly.
Pair Corralation between Eastern Air and Eastroc Beverage
Assuming the 90 days trading horizon Eastern Air Logistics is expected to under-perform the Eastroc Beverage. But the stock apears to be less risky and, when comparing its historical volatility, Eastern Air Logistics is 1.05 times less risky than Eastroc Beverage. The stock trades about -0.09 of its potential returns per unit of risk. The Eastroc Beverage Group is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 22,348 in Eastroc Beverage Group on October 8, 2024 and sell it today you would earn a total of 2,292 from holding Eastroc Beverage Group or generate 10.26% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Eastern Air Logistics vs. Eastroc Beverage Group
Performance |
Timeline |
Eastern Air Logistics |
Eastroc Beverage |
Eastern Air and Eastroc Beverage Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eastern Air and Eastroc Beverage
The main advantage of trading using opposite Eastern Air and Eastroc Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastern Air position performs unexpectedly, Eastroc Beverage 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 Eastroc Beverage will offset losses from the drop in Eastroc Beverage's long position.Eastern Air vs. Cloud Live Technology | Eastern Air vs. Nanjing Putian Telecommunications | Eastern Air vs. Tianjin Realty Development | Eastern Air vs. Shenzhen Coship Electronics |
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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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