Correlation Between Aegean Airlines and Live Nation
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Live Nation 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 Live Nation 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 Live Nation Entertainment, you can compare the effects of market volatilities on Aegean Airlines and Live Nation 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 Live Nation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Live Nation.
Diversification Opportunities for Aegean Airlines and Live Nation
-0.93 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aegean and Live is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Live Nation Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Nation Entertainment 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 Live Nation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Nation Entertainment has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Live Nation go up and down completely randomly.
Pair Corralation between Aegean Airlines and Live Nation
Assuming the 90 days horizon Aegean Airlines SA is expected to under-perform the Live Nation. But the stock apears to be less risky and, when comparing its historical volatility, Aegean Airlines SA is 1.55 times less risky than Live Nation. The stock trades about -0.13 of its potential returns per unit of risk. The Live Nation Entertainment is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 10,770 in Live Nation Entertainment on August 29, 2024 and sell it today you would earn a total of 2,795 from holding Live Nation Entertainment or generate 25.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegean Airlines SA vs. Live Nation Entertainment
Performance |
| Timeline |
| Aegean Airlines SA |
| Live Nation Entertainment |
Aegean Airlines and Live Nation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Live Nation
The main advantage of trading using opposite Aegean Airlines and Live Nation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Live Nation 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 Live Nation will offset losses from the drop in Live Nation's long position.| Aegean Airlines vs. Ryanair Holdings plc | Aegean Airlines vs. Superior Plus Corp | Aegean Airlines vs. NMI Holdings | Aegean Airlines vs. Origin Agritech |
| Live Nation vs. Superior Plus Corp | Live Nation vs. NMI Holdings | Live Nation vs. SIVERS SEMICONDUCTORS AB | Live Nation vs. Talanx AG |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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