Correlation Between Aegean Airlines and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Origin Agritech 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 Origin Agritech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegean Airlines SA and Origin Agritech, you can compare the effects of market volatilities on Aegean Airlines and Origin Agritech 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 Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Origin Agritech.
Diversification Opportunities for Aegean Airlines and Origin Agritech
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aegean and Origin is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech 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 SA are associated (or correlated) with Origin Agritech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Agritech has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Origin Agritech go up and down completely randomly.
Pair Corralation between Aegean Airlines and Origin Agritech
Assuming the 90 days horizon Aegean Airlines SA is expected to generate 0.3 times more return on investment than Origin Agritech. However, Aegean Airlines SA is 3.34 times less risky than Origin Agritech. It trades about -0.01 of its potential returns per unit of risk. Origin Agritech is currently generating about -0.22 per unit of risk. If you would invest 1,008 in Aegean Airlines SA on October 20, 2024 and sell it today you would lose (4.00) from holding Aegean Airlines SA or give up 0.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Aegean Airlines SA vs. Origin Agritech
Performance |
| Timeline |
| Aegean Airlines SA |
| Origin Agritech |
Aegean Airlines and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Origin Agritech
The main advantage of trading using opposite Aegean Airlines and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Origin Agritech 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 Origin Agritech will offset losses from the drop in Origin Agritech's long position.| Aegean Airlines vs. NXP Semiconductors NV | Aegean Airlines vs. International Game Technology | Aegean Airlines vs. ELMOS SEMICONDUCTOR | Aegean Airlines vs. VIVA WINE GROUP |
| Origin Agritech vs. Reinsurance Group of | Origin Agritech vs. Alfa Financial Software | Origin Agritech vs. Take Two Interactive Software | Origin Agritech vs. QBE Insurance Group |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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