Correlation Between Virgin Australia and China Southern
Can any of the company-specific risk be diversified away by investing in both Virgin Australia and China Southern 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 Virgin Australia and China Southern into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virgin Australia Holdings and China Southern Airlines, you can compare the effects of market volatilities on Virgin Australia and China Southern 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 Virgin Australia with a short position of China Southern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virgin Australia and China Southern.
Diversification Opportunities for Virgin Australia and China Southern
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Virgin and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Virgin Australia Holdings and China Southern Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Southern Airlines and Virgin Australia 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 Virgin Australia Holdings are associated (or correlated) with China Southern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Southern Airlines has no effect on the direction of Virgin Australia i.e., Virgin Australia and China Southern go up and down completely randomly.
Pair Corralation between Virgin Australia and China Southern
If you would invest 3,697 in China Southern Airlines on December 29, 2023 and sell it today you would earn a total of 0.00 from holding China Southern Airlines or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Virgin Australia Holdings vs. China Southern Airlines
Performance |
Timeline |
Virgin Australia Holdings |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
China Southern Airlines |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Virgin Australia and China Southern Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Virgin Australia and China Southern
The main advantage of trading using opposite Virgin Australia and China Southern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virgin Australia position performs unexpectedly, China Southern 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 China Southern will offset losses from the drop in China Southern's long position.Virgin Australia vs. Dave Busters Entertainment | Virgin Australia vs. Sphere Entertainment Co | Virgin Australia vs. Q2 Holdings | Virgin Australia vs. NeogamesSA |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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