Correlation Between Air New and EVE Health
Can any of the company-specific risk be diversified away by investing in both Air New and EVE Health 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 Air New and EVE Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air New Zealand and EVE Health Group, you can compare the effects of market volatilities on Air New and EVE Health 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 Air New with a short position of EVE Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air New and EVE Health.
Diversification Opportunities for Air New and EVE Health
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Air and EVE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Air New Zealand and EVE Health Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVE Health Group and Air New 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 Air New Zealand are associated (or correlated) with EVE Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVE Health Group has no effect on the direction of Air New i.e., Air New and EVE Health go up and down completely randomly.
Pair Corralation between Air New and EVE Health
If you would invest 50.00 in Air New Zealand on December 18, 2024 and sell it today you would earn a total of 6.00 from holding Air New Zealand or generate 12.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Air New Zealand vs. EVE Health Group
Performance |
Timeline |
Air New Zealand |
EVE Health Group |
Air New and EVE Health Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Air New and EVE Health
The main advantage of trading using opposite Air New and EVE Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air New position performs unexpectedly, EVE Health 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 EVE Health will offset losses from the drop in EVE Health's long position.Air New vs. DMC Mining | Air New vs. Clime Investment Management | Air New vs. Gateway Mining | Air New vs. Galena Mining |
EVE Health vs. Carlton Investments | EVE Health vs. Cleanaway Waste Management | EVE Health vs. Carnegie Clean Energy | EVE Health vs. Australian Strategic Materials |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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