Correlation Between TOTAL ENERGY and Air New
Can any of the company-specific risk be diversified away by investing in both TOTAL ENERGY and Air New 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 TOTAL ENERGY and Air New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TOTAL ENERGY SERVS and Air New Zealand, you can compare the effects of market volatilities on TOTAL ENERGY and Air New 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 TOTAL ENERGY with a short position of Air New. Check out your portfolio center. Please also check ongoing floating volatility patterns of TOTAL ENERGY and Air New.
Diversification Opportunities for TOTAL ENERGY and Air New
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between TOTAL and Air is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding TOTAL ENERGY SERVS and Air New Zealand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air New Zealand and TOTAL ENERGY 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 TOTAL ENERGY SERVS are associated (or correlated) with Air New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air New Zealand has no effect on the direction of TOTAL ENERGY i.e., TOTAL ENERGY and Air New go up and down completely randomly.
Pair Corralation between TOTAL ENERGY and Air New
Assuming the 90 days horizon TOTAL ENERGY SERVS is expected to under-perform the Air New. In addition to that, TOTAL ENERGY is 1.31 times more volatile than Air New Zealand. It trades about -0.04 of its total potential returns per unit of risk. Air New Zealand is currently generating about 0.01 per unit of volatility. If you would invest 34.00 in Air New Zealand on December 4, 2024 and sell it today you would earn a total of 0.00 from holding Air New Zealand or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
TOTAL ENERGY SERVS vs. Air New Zealand
Performance |
| Timeline |
| TOTAL ENERGY SERVS |
| Air New Zealand |
TOTAL ENERGY and Air New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TOTAL ENERGY and Air New
The main advantage of trading using opposite TOTAL ENERGY and Air New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TOTAL ENERGY position performs unexpectedly, Air New 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 Air New will offset losses from the drop in Air New's long position.| TOTAL ENERGY vs. American Airlines Group | TOTAL ENERGY vs. United Overseas Insurance | TOTAL ENERGY vs. COREBRIDGE FINANCIAL INC | TOTAL ENERGY vs. BANK OCHINA H |
| Air New vs. Endeavour Mining PLC | Air New vs. Methode Electronics | Air New vs. Arrow Electronics | Air New vs. AOI Electronics Co |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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