Correlation Between Ihuman and Air Lease

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

By analyzing existing cross correlation between Ihuman Inc and Air Lease, you can compare the effects of market volatilities on Ihuman and Air Lease 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 Ihuman with a short position of Air Lease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihuman and Air Lease.

Diversification Opportunities for Ihuman and Air Lease

-0.05

Correlation Coefficient

Ihuman  Air Lease

Good diversification

The 3 months correlation between Ihuman and Air is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Ihuman Inc and Air Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Lease and Ihuman 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 Ihuman Inc are associated (or correlated) with Air Lease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Lease has no effect on the direction of Ihuman i.e., Ihuman and Air Lease go up and down completely randomly.

Pair Corralation between Ihuman and Air Lease

Allowing for the 90-day total investment horizon Ihuman Inc is expected to generate 2.38 times more return on investment than Air Lease. However, Ihuman is 2.38 times more volatile than Air Lease. It trades about 0.14 of its potential returns per unit of risk. Air Lease is currently generating about 0.0 per unit of risk. If you would invest  176.00  in Ihuman Inc on December 25, 2024 and sell it today you would earn a total of  71.50  from holding Ihuman Inc or generate 40.63% return on investment over 90 days.

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

Ihuman Inc  vs.  Air Lease

Ihuman Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ihuman Inc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical indicators, Ihuman demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Air Lease

Risk-Adjusted Performance

Weak

Over the last 90 days Air Lease has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, Air Lease is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Ihuman and Air Lease

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

The idea behind Ihuman Inc and Air Lease 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.

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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..