Correlation Between COFACE SA and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both COFACE SA 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 COFACE SA and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COFACE SA and AEGEAN AIRLINES, you can compare the effects of market volatilities on COFACE SA 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 COFACE SA with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of COFACE SA and AEGEAN AIRLINES.
Diversification Opportunities for COFACE SA and AEGEAN AIRLINES
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between COFACE and AEGEAN is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding COFACE SA and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and COFACE SA 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 COFACE SA 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 has no effect on the direction of COFACE SA i.e., COFACE SA and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between COFACE SA and AEGEAN AIRLINES
Assuming the 90 days horizon COFACE SA is expected to generate 1.07 times less return on investment than AEGEAN AIRLINES. In addition to that, COFACE SA is 1.14 times more volatile than AEGEAN AIRLINES. It trades about 0.16 of its total potential returns per unit of risk. AEGEAN AIRLINES is currently generating about 0.19 per unit of volatility. If you would invest 991.00 in AEGEAN AIRLINES on October 12, 2024 and sell it today you would earn a total of 40.00 from holding AEGEAN AIRLINES or generate 4.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COFACE SA vs. AEGEAN AIRLINES
Performance |
| Timeline |
| COFACE SA |
| AEGEAN AIRLINES |
COFACE SA and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COFACE SA and AEGEAN AIRLINES
The main advantage of trading using opposite COFACE SA and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COFACE SA 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's long position.| COFACE SA vs. AEGEAN AIRLINES | COFACE SA vs. Sixt Leasing SE | COFACE SA vs. Clean Energy Fuels | COFACE SA vs. International Consolidated Airlines |
| AEGEAN AIRLINES vs. CLOVER HEALTH INV | AEGEAN AIRLINES vs. MPH Health Care | AEGEAN AIRLINES vs. YOOMA WELLNESS INC | AEGEAN AIRLINES vs. DFS Furniture PLC |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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