Correlation Between G8 EDUCATION and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both G8 EDUCATION and Aegean Airlines 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 G8 EDUCATION and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G8 EDUCATION and Aegean Airlines SA, you can compare the effects of market volatilities on G8 EDUCATION and Aegean Airlines 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 G8 EDUCATION with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of G8 EDUCATION and Aegean Airlines.
Diversification Opportunities for G8 EDUCATION and Aegean Airlines
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 3EAG and Aegean is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding G8 EDUCATION and Aegean Airlines SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegean Airlines SA and G8 EDUCATION 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 G8 EDUCATION are associated (or correlated) with Aegean Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegean Airlines SA has no effect on the direction of G8 EDUCATION i.e., G8 EDUCATION and Aegean Airlines go up and down completely randomly.
Pair Corralation between G8 EDUCATION and Aegean Airlines
Assuming the 90 days trading horizon G8 EDUCATION is expected to under-perform the Aegean Airlines. In addition to that, G8 EDUCATION is 1.53 times more volatile than Aegean Airlines SA. It trades about -0.16 of its total potential returns per unit of risk. Aegean Airlines SA is currently generating about 0.2 per unit of volatility. If you would invest 1,005 in Aegean Airlines SA on October 11, 2024 and sell it today you would earn a total of 37.00 from holding Aegean Airlines SA or generate 3.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
G8 EDUCATION vs. Aegean Airlines SA
Performance |
| Timeline |
| G8 EDUCATION |
| Aegean Airlines SA |
G8 EDUCATION and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G8 EDUCATION and Aegean Airlines
The main advantage of trading using opposite G8 EDUCATION and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G8 EDUCATION position performs unexpectedly, Aegean Airlines 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 Aegean Airlines will offset losses from the drop in Aegean Airlines' long position.| G8 EDUCATION vs. VIVA WINE GROUP | G8 EDUCATION vs. SAN MIGUEL BREWERY | G8 EDUCATION vs. Ebro Foods SA | G8 EDUCATION vs. Molson Coors Beverage |
| Aegean Airlines vs. Playtech plc | Aegean Airlines vs. G8 EDUCATION | Aegean Airlines vs. Laureate Education | Aegean Airlines vs. Playmates Toys Limited |
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.
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