Correlation Between AEGEAN AIRLINES and Berkshire Hills

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Can any of the company-specific risk be diversified away by investing in both AEGEAN AIRLINES and Berkshire Hills 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 AEGEAN AIRLINES and Berkshire Hills into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AEGEAN AIRLINES and Berkshire Hills Bancorp, you can compare the effects of market volatilities on AEGEAN AIRLINES and Berkshire Hills 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 AEGEAN AIRLINES with a short position of Berkshire Hills. Check out your portfolio center. Please also check ongoing floating volatility patterns of AEGEAN AIRLINES and Berkshire Hills.

Diversification Opportunities for AEGEAN AIRLINES and Berkshire Hills

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between AEGEAN and Berkshire is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AEGEAN AIRLINES and Berkshire Hills Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkshire Hills Bancorp and AEGEAN AIRLINES 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 AEGEAN AIRLINES are associated (or correlated) with Berkshire Hills. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berkshire Hills Bancorp has no effect on the direction of AEGEAN AIRLINES i.e., AEGEAN AIRLINES and Berkshire Hills go up and down completely randomly.

Pair Corralation between AEGEAN AIRLINES and Berkshire Hills

If you would invest  0.00  in Berkshire Hills Bancorp on September 14, 2024 and sell it today you would earn a total of  0.00  from holding Berkshire Hills Bancorp or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.4%
ValuesDaily Returns

AEGEAN AIRLINES  vs.  Berkshire Hills Bancorp

 Performance 
       Timeline  
AEGEAN AIRLINES 

Risk-Adjusted Performance

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Over the last 90 days AEGEAN AIRLINES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.
Berkshire Hills Bancorp 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Berkshire Hills Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Berkshire Hills is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

AEGEAN AIRLINES and Berkshire Hills Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with AEGEAN AIRLINES and Berkshire Hills

The main advantage of trading using opposite AEGEAN AIRLINES and Berkshire Hills positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AEGEAN AIRLINES position performs unexpectedly, Berkshire Hills 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 Berkshire Hills will offset losses from the drop in Berkshire Hills' long position.
The idea behind AEGEAN AIRLINES and Berkshire Hills Bancorp 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.
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.

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