Correlation Between Ming Yang and China Eastern
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By analyzing existing cross correlation between Ming Yang Smart and China Eastern Airlines, you can compare the effects of market volatilities on Ming Yang and China Eastern 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 Ming Yang with a short position of China Eastern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ming Yang and China Eastern.
Diversification Opportunities for Ming Yang and China Eastern
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ming and China is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Ming Yang Smart and China Eastern Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Eastern Airlines and Ming Yang 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 Ming Yang Smart are associated (or correlated) with China Eastern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Eastern Airlines has no effect on the direction of Ming Yang i.e., Ming Yang and China Eastern go up and down completely randomly.
Pair Corralation between Ming Yang and China Eastern
Assuming the 90 days trading horizon Ming Yang Smart is expected to under-perform the China Eastern. In addition to that, Ming Yang is 1.1 times more volatile than China Eastern Airlines. It trades about -0.26 of its total potential returns per unit of risk. China Eastern Airlines is currently generating about -0.06 per unit of volatility. If you would invest 404.00 in China Eastern Airlines on October 23, 2024 and sell it today you would lose (13.00) from holding China Eastern Airlines or give up 3.22% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Ming Yang Smart vs. China Eastern Airlines
Performance |
Timeline |
Ming Yang Smart |
China Eastern Airlines |
Ming Yang and China Eastern Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ming Yang and China Eastern
The main advantage of trading using opposite Ming Yang and China Eastern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ming Yang position performs unexpectedly, China Eastern 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 Eastern will offset losses from the drop in China Eastern's long position.Ming Yang vs. Guangzhou Zhujiang Brewery | Ming Yang vs. Heilongjiang Transport Development | Ming Yang vs. Cansino Biologics | Ming Yang vs. Elite Color Environmental |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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