Correlation Between Nanjing Medlander and Air China
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By analyzing existing cross correlation between Nanjing Medlander Medical and Air China Ltd, you can compare the effects of market volatilities on Nanjing Medlander and Air China 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 Nanjing Medlander with a short position of Air China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Medlander and Air China.
Diversification Opportunities for Nanjing Medlander and Air China
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nanjing and Air is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Medlander Medical and Air China Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air China and Nanjing Medlander 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 Nanjing Medlander Medical are associated (or correlated) with Air China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air China has no effect on the direction of Nanjing Medlander i.e., Nanjing Medlander and Air China go up and down completely randomly.
Pair Corralation between Nanjing Medlander and Air China
Assuming the 90 days trading horizon Nanjing Medlander Medical is expected to under-perform the Air China. But the stock apears to be less risky and, when comparing its historical volatility, Nanjing Medlander Medical is 1.08 times less risky than Air China. The stock trades about -0.06 of its potential returns per unit of risk. The Air China Ltd is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 787.00 in Air China Ltd on September 22, 2024 and sell it today you would earn a total of 10.00 from holding Air China Ltd or generate 1.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Nanjing Medlander Medical vs. Air China Ltd
Performance |
Timeline |
Nanjing Medlander Medical |
Air China |
Nanjing Medlander and Air China Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Nanjing Medlander and Air China
The main advantage of trading using opposite Nanjing Medlander and Air China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Medlander position performs unexpectedly, Air China 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 China will offset losses from the drop in Air China's long position.Nanjing Medlander vs. Industrial and Commercial | Nanjing Medlander vs. Kweichow Moutai Co | Nanjing Medlander vs. Agricultural Bank of | Nanjing Medlander vs. China Mobile Limited |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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