Correlation Between Aegean Airlines and MAG Silver
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and MAG Silver 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 MAG Silver 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 MAG Silver Corp, you can compare the effects of market volatilities on Aegean Airlines and MAG Silver 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 MAG Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and MAG Silver.
Diversification Opportunities for Aegean Airlines and MAG Silver
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aegean and MAG is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and MAG Silver Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAG Silver Corp 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 MAG Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAG Silver Corp has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and MAG Silver go up and down completely randomly.
Pair Corralation between Aegean Airlines and MAG Silver
Assuming the 90 days horizon Aegean Airlines is expected to generate 1.18 times less return on investment than MAG Silver. But when comparing it to its historical volatility, Aegean Airlines SA is 1.16 times less risky than MAG Silver. It trades about 0.22 of its potential returns per unit of risk. MAG Silver Corp is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,318 in MAG Silver Corp on October 26, 2024 and sell it today you would earn a total of 137.00 from holding MAG Silver Corp or generate 10.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Aegean Airlines SA vs. MAG Silver Corp
Performance |
| Timeline |
| Aegean Airlines SA |
| MAG Silver Corp |
Aegean Airlines and MAG Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and MAG Silver
The main advantage of trading using opposite Aegean Airlines and MAG Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, MAG Silver 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 MAG Silver will offset losses from the drop in MAG Silver's long position.| Aegean Airlines vs. Delta Air Lines | Aegean Airlines vs. Air China Limited | Aegean Airlines vs. AIR CHINA LTD | Aegean Airlines vs. RYANAIR HLDGS ADR |
| MAG Silver vs. American Eagle Outfitters | MAG Silver vs. The Yokohama Rubber | MAG Silver vs. Playa Hotels Resorts | MAG Silver vs. Summit Materials |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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