Correlation Between Chocoladefabriken and Alaska Air
Can any of the company-specific risk be diversified away by investing in both Chocoladefabriken and Alaska Air 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 Chocoladefabriken and Alaska Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chocoladefabriken Lindt Spruengli and Alaska Air Group, you can compare the effects of market volatilities on Chocoladefabriken and Alaska Air 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 Chocoladefabriken with a short position of Alaska Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chocoladefabriken and Alaska Air.
Diversification Opportunities for Chocoladefabriken and Alaska Air
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Chocoladefabriken and Alaska is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Chocoladefabriken Lindt Spruen and Alaska Air Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alaska Air Group and Chocoladefabriken 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 Chocoladefabriken Lindt Spruengli are associated (or correlated) with Alaska Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alaska Air Group has no effect on the direction of Chocoladefabriken i.e., Chocoladefabriken and Alaska Air go up and down completely randomly.
Pair Corralation between Chocoladefabriken and Alaska Air
Assuming the 90 days trading horizon Chocoladefabriken is expected to generate 1.93 times less return on investment than Alaska Air. But when comparing it to its historical volatility, Chocoladefabriken Lindt Spruengli is 1.91 times less risky than Alaska Air. It trades about 0.1 of its potential returns per unit of risk. Alaska Air Group is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 6,721 in Alaska Air Group on October 26, 2024 and sell it today you would earn a total of 211.00 from holding Alaska Air Group or generate 3.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Chocoladefabriken Lindt Spruen vs. Alaska Air Group
Performance |
| Timeline |
| Chocoladefabriken Lindt |
| Alaska Air Group |
Chocoladefabriken and Alaska Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chocoladefabriken and Alaska Air
The main advantage of trading using opposite Chocoladefabriken and Alaska Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chocoladefabriken position performs unexpectedly, Alaska Air 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 Alaska Air will offset losses from the drop in Alaska Air's long position.| Chocoladefabriken vs. Bisichi Mining PLC | Chocoladefabriken vs. First Class Metals | Chocoladefabriken vs. Metals Exploration Plc | Chocoladefabriken vs. Fulcrum Metals PLC |
| Alaska Air vs. Berkshire Hathaway | Alaska Air vs. Samsung Electronics Co | Alaska Air vs. Samsung Electronics Co | Alaska Air vs. Chocoladefabriken Lindt Spruengli |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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