Correlation Between AerCap Holdings and Eshallgo

Can any of the company-specific risk be diversified away by investing in both AerCap Holdings and Eshallgo 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 AerCap Holdings and Eshallgo into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AerCap Holdings NV and Eshallgo Class A, you can compare the effects of market volatilities on AerCap Holdings and Eshallgo 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 AerCap Holdings with a short position of Eshallgo. Check out your portfolio center. Please also check ongoing floating volatility patterns of AerCap Holdings and Eshallgo.

Diversification Opportunities for AerCap Holdings and Eshallgo

-0.02

Correlation Coefficient

AerCap Holdings  Eshallgo

Good diversification

The 3 months correlation between AerCap and Eshallgo is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding AerCap Holdings NV and Eshallgo Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eshallgo Class A and AerCap Holdings 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 AerCap Holdings NV are associated (or correlated) with Eshallgo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eshallgo Class A has no effect on the direction of AerCap Holdings i.e., AerCap Holdings and Eshallgo go up and down completely randomly.

Pair Corralation between AerCap Holdings and Eshallgo

Considering the 90-day investment horizon AerCap Holdings NV is expected to generate 0.05 times more return on investment than Eshallgo. However, AerCap Holdings NV is 19.2 times less risky than Eshallgo. It trades about 0.05 of its potential returns per unit of risk. Eshallgo Class A is currently generating about -0.24 per unit of risk. If you would invest  9,505  in AerCap Holdings NV on October 22, 2024 and sell it today you would earn a total of  65.00  from holding AerCap Holdings NV or generate 0.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

AerCap Holdings NV  vs.  Eshallgo Class A

AerCap Holdings NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AerCap Holdings NV has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, AerCap Holdings is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Eshallgo Class A

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eshallgo Class A has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with AerCap Holdings and Eshallgo

The main advantage of trading using opposite AerCap Holdings and Eshallgo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AerCap Holdings position performs unexpectedly, Eshallgo 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 Eshallgo will offset losses from the drop in Eshallgo's long position.

The idea behind AerCap Holdings NV and Eshallgo Class A 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.

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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.