Correlation Between Alaska Air and Amaroq Minerals
Can any of the company-specific risk be diversified away by investing in both Alaska Air and Amaroq Minerals 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 Alaska Air and Amaroq Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alaska Air Group and Amaroq Minerals, you can compare the effects of market volatilities on Alaska Air and Amaroq Minerals 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 Alaska Air with a short position of Amaroq Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alaska Air and Amaroq Minerals.
Diversification Opportunities for Alaska Air and Amaroq Minerals
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Alaska and Amaroq is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Alaska Air Group and Amaroq Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amaroq Minerals and Alaska Air 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 Alaska Air Group are associated (or correlated) with Amaroq Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amaroq Minerals has no effect on the direction of Alaska Air i.e., Alaska Air and Amaroq Minerals go up and down completely randomly.
Pair Corralation between Alaska Air and Amaroq Minerals
Assuming the 90 days trading horizon Alaska Air Group is expected to generate 1.15 times more return on investment than Amaroq Minerals. However, Alaska Air is 1.15 times more volatile than Amaroq Minerals. It trades about 0.33 of its potential returns per unit of risk. Amaroq Minerals is currently generating about 0.31 per unit of risk. If you would invest 5,406 in Alaska Air Group on October 10, 2024 and sell it today you would earn a total of 1,229 from holding Alaska Air Group or generate 22.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Alaska Air Group vs. Amaroq Minerals
Performance |
| Timeline |
| Alaska Air Group |
| Amaroq Minerals |
Alaska Air and Amaroq Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alaska Air and Amaroq Minerals
The main advantage of trading using opposite Alaska Air and Amaroq Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alaska Air position performs unexpectedly, Amaroq Minerals 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 Amaroq Minerals will offset losses from the drop in Amaroq Minerals' long position.| Alaska Air vs. Dairy Farm International | Alaska Air vs. alstria office REIT AG | Alaska Air vs. MoneysupermarketCom Group PLC | Alaska Air vs. BE Semiconductor Industries |
| Amaroq Minerals vs. Live Nation Entertainment | Amaroq Minerals vs. Westlake Chemical Corp | Amaroq Minerals vs. Metro Bank PLC | Amaroq Minerals vs. G5 Entertainment AB |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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