diversifiable risk of combining AerCap Holdings and China Aircraft 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 China Aircraft Leasing, you can compare the effects of market volatilities on AerCap Holdings and China Aircraft 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 China Aircraft. Check out your portfolio center. Please also check ongoing floating volatility patterns of AerCap Holdings and China Aircraft.
Diversification Opportunities for AerCap Holdings and China Aircraft
Pair Corralation between AerCap Holdings and China Aircraft
AerCap Holdings NV vs. China Aircraft Leasing
AerCap Holdings and China Aircraft Volatility Contrast
Pair Trading with AerCap Holdings and China AircraftThe main advantage of trading using opposite AerCap Holdings and China Aircraft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AerCap Holdings position performs unexpectedly, China Aircraft 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 Aircraft will offset losses from the drop in China Aircraft's long position. The idea behind AerCap Holdings NV and China Aircraft Leasing 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.