Correlation Between AWILCO DRILLING and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both AWILCO DRILLING and AEGEAN AIRLINES 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 AWILCO DRILLING and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AWILCO DRILLING PLC and AEGEAN AIRLINES, you can compare the effects of market volatilities on AWILCO DRILLING and AEGEAN AIRLINES 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 AWILCO DRILLING with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of AWILCO DRILLING and AEGEAN AIRLINES.
Diversification Opportunities for AWILCO DRILLING and AEGEAN AIRLINES
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between AWILCO and AEGEAN is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding AWILCO DRILLING PLC and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and AWILCO DRILLING 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 AWILCO DRILLING PLC are associated (or correlated) with AEGEAN AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEGEAN AIRLINES has no effect on the direction of AWILCO DRILLING i.e., AWILCO DRILLING and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between AWILCO DRILLING and AEGEAN AIRLINES
Assuming the 90 days trading horizon AWILCO DRILLING PLC is expected to generate 7.93 times more return on investment than AEGEAN AIRLINES. However, AWILCO DRILLING is 7.93 times more volatile than AEGEAN AIRLINES. It trades about 0.06 of its potential returns per unit of risk. AEGEAN AIRLINES is currently generating about 0.01 per unit of risk. If you would invest 79.00 in AWILCO DRILLING PLC on September 2, 2024 and sell it today you would earn a total of 115.00 from holding AWILCO DRILLING PLC or generate 145.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AWILCO DRILLING PLC vs. AEGEAN AIRLINES
Performance |
| Timeline |
| AWILCO DRILLING PLC |
| AEGEAN AIRLINES |
AWILCO DRILLING and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AWILCO DRILLING and AEGEAN AIRLINES
The main advantage of trading using opposite AWILCO DRILLING and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AWILCO DRILLING position performs unexpectedly, AEGEAN AIRLINES 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 AEGEAN AIRLINES will offset losses from the drop in AEGEAN AIRLINES's long position.| AWILCO DRILLING vs. Apple Inc | AWILCO DRILLING vs. Apple Inc | AWILCO DRILLING vs. Apple Inc | AWILCO DRILLING vs. Apple Inc |
| AEGEAN AIRLINES vs. Reinsurance Group of | AEGEAN AIRLINES vs. Iridium Communications | AEGEAN AIRLINES vs. Universal Insurance Holdings | AEGEAN AIRLINES vs. Cogent Communications Holdings |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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