Correlation Between AEGEAN AIRLINES and MGIC INVESTMENT
Can any of the company-specific risk be diversified away by investing in both AEGEAN AIRLINES and MGIC INVESTMENT 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 MGIC INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AEGEAN AIRLINES and MGIC INVESTMENT, you can compare the effects of market volatilities on AEGEAN AIRLINES and MGIC INVESTMENT 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 MGIC INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of AEGEAN AIRLINES and MGIC INVESTMENT.
Diversification Opportunities for AEGEAN AIRLINES and MGIC INVESTMENT
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AEGEAN and MGIC is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding AEGEAN AIRLINES and MGIC INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGIC INVESTMENT 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 MGIC INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGIC INVESTMENT has no effect on the direction of AEGEAN AIRLINES i.e., AEGEAN AIRLINES and MGIC INVESTMENT go up and down completely randomly.
Pair Corralation between AEGEAN AIRLINES and MGIC INVESTMENT
Assuming the 90 days trading horizon AEGEAN AIRLINES is expected to under-perform the MGIC INVESTMENT. But the stock apears to be less risky and, when comparing its historical volatility, AEGEAN AIRLINES is 1.11 times less risky than MGIC INVESTMENT. The stock trades about -0.19 of its potential returns per unit of risk. The MGIC INVESTMENT is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,307 in MGIC INVESTMENT on August 28, 2024 and sell it today you would earn a total of 133.00 from holding MGIC INVESTMENT or generate 5.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AEGEAN AIRLINES vs. MGIC INVESTMENT
Performance |
| Timeline |
| AEGEAN AIRLINES |
| MGIC INVESTMENT |
AEGEAN AIRLINES and MGIC INVESTMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AEGEAN AIRLINES and MGIC INVESTMENT
The main advantage of trading using opposite AEGEAN AIRLINES and MGIC INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AEGEAN AIRLINES position performs unexpectedly, MGIC INVESTMENT 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 MGIC INVESTMENT will offset losses from the drop in MGIC INVESTMENT's long position.| AEGEAN AIRLINES vs. COMBA TELECOM SYST | AEGEAN AIRLINES vs. Rogers Communications | AEGEAN AIRLINES vs. INTERSHOP Communications Aktiengesellschaft | AEGEAN AIRLINES vs. China Communications Services |
| MGIC INVESTMENT vs. SMA Solar Technology | MGIC INVESTMENT vs. Firan Technology Group | MGIC INVESTMENT vs. Vishay Intertechnology | MGIC INVESTMENT vs. Micron Technology |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |