Correlation Between Ryanair Holdings and Cheche Group

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

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

Diversification Opportunities for Ryanair Holdings and Cheche Group

0.13

Correlation Coefficient

Ryanair Holdings  Cheche Group

Average diversification

The 3 months correlation between Ryanair and Cheche is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Ryanair Holdings PLC and Cheche Group Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheche Group Class and Ryanair 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 Ryanair Holdings PLC are associated (or correlated) with Cheche Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheche Group Class has no effect on the direction of Ryanair Holdings i.e., Ryanair Holdings and Cheche Group go up and down completely randomly.

Pair Corralation between Ryanair Holdings and Cheche Group

Assuming the 90 days horizon Ryanair Holdings PLC is expected to generate 0.45 times more return on investment than Cheche Group. However, Ryanair Holdings PLC is 2.21 times less risky than Cheche Group. It trades about -0.05 of its potential returns per unit of risk. Cheche Group Class is currently generating about -0.04 per unit of risk. If you would invest  4,635  in Ryanair Holdings PLC on October 11, 2024 and sell it today you would lose (185.00) from holding Ryanair Holdings PLC or give up 3.99% of portfolio value over 90 days.

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

Ryanair Holdings PLC  vs.  Cheche Group Class

Ryanair Holdings PLC

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ryanair Holdings PLC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Ryanair Holdings is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Cheche Group Class

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Cheche Group Class are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady fundamental indicators, Cheche Group may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Ryanair Holdings and Cheche Group

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

The idea behind Ryanair Holdings PLC and Cheche Group Class 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.