Correlation Between Delta Air and Creo Medical
Can any of the company-specific risk be diversified away by investing in both Delta Air and Creo Medical 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 Delta Air and Creo Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delta Air Lines and Creo Medical Group, you can compare the effects of market volatilities on Delta Air and Creo Medical 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 Delta Air with a short position of Creo Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Air and Creo Medical.
Diversification Opportunities for Delta Air and Creo Medical
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Delta and Creo is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding Delta Air Lines and Creo Medical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Creo Medical Group and Delta 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 Delta Air Lines are associated (or correlated) with Creo Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Creo Medical Group has no effect on the direction of Delta Air i.e., Delta Air and Creo Medical go up and down completely randomly.
Pair Corralation between Delta Air and Creo Medical
Assuming the 90 days trading horizon Delta Air Lines is expected to generate 0.69 times more return on investment than Creo Medical. However, Delta Air Lines is 1.45 times less risky than Creo Medical. It trades about 0.14 of its potential returns per unit of risk. Creo Medical Group is currently generating about -0.08 per unit of risk. If you would invest 3,217 in Delta Air Lines on September 1, 2024 and sell it today you would earn a total of 3,158 from holding Delta Air Lines or generate 98.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.26% |
| Values | Daily Returns |
Delta Air Lines vs. Creo Medical Group
Performance |
| Timeline |
| Delta Air Lines |
| Creo Medical Group |
Delta Air and Creo Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delta Air and Creo Medical
The main advantage of trading using opposite Delta Air and Creo Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delta Air position performs unexpectedly, Creo Medical 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 Creo Medical will offset losses from the drop in Creo Medical's long position.| Delta Air vs. Induction Healthcare Group | Delta Air vs. CVS Health Corp | Delta Air vs. Federal Realty Investment | Delta Air vs. Optima Health plc |
| Creo Medical vs. Samsung Electronics Co | Creo Medical vs. Samsung Electronics Co | Creo Medical vs. Hyundai Motor | Creo Medical vs. Toyota Motor Corp |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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