Correlation Between Aegean Airlines and Constellation Software
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Constellation Software 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 Constellation Software 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 Constellation Software, you can compare the effects of market volatilities on Aegean Airlines and Constellation Software 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 Constellation Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Constellation Software.
Diversification Opportunities for Aegean Airlines and Constellation Software
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aegean and Constellation is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Constellation Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Constellation Software 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 Constellation Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Constellation Software has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Constellation Software go up and down completely randomly.
Pair Corralation between Aegean Airlines and Constellation Software
Assuming the 90 days horizon Aegean Airlines is expected to generate 1.35 times less return on investment than Constellation Software. In addition to that, Aegean Airlines is 1.79 times more volatile than Constellation Software. It trades about 0.05 of its total potential returns per unit of risk. Constellation Software is currently generating about 0.11 per unit of volatility. If you would invest 165,219 in Constellation Software on November 9, 2024 and sell it today you would earn a total of 161,781 from holding Constellation Software or generate 97.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegean Airlines SA vs. Constellation Software
Performance |
| Timeline |
| Aegean Airlines SA |
| Constellation Software |
Aegean Airlines and Constellation Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Constellation Software
The main advantage of trading using opposite Aegean Airlines and Constellation Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Constellation Software 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 Constellation Software will offset losses from the drop in Constellation Software's long position.| Aegean Airlines vs. Prosiebensat 1 Media | Aegean Airlines vs. Japan Tobacco | Aegean Airlines vs. Tradegate AG Wertpapierhandelsbank | Aegean Airlines vs. IMPERIAL TOBACCO |
| Constellation Software vs. Perseus Mining Limited | Constellation Software vs. East Africa Metals | Constellation Software vs. CHINA EDUCATION GROUP | Constellation Software vs. EEDUCATION ALBERT AB |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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