Correlation Between CLOVER HEALTH and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both CLOVER HEALTH 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 CLOVER HEALTH and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CLOVER HEALTH INV and AEGEAN AIRLINES, you can compare the effects of market volatilities on CLOVER HEALTH 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 CLOVER HEALTH with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of CLOVER HEALTH and AEGEAN AIRLINES.
Diversification Opportunities for CLOVER HEALTH and AEGEAN AIRLINES
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CLOVER and AEGEAN is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding CLOVER HEALTH INV and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and CLOVER HEALTH 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 CLOVER HEALTH INV 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 CLOVER HEALTH i.e., CLOVER HEALTH and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between CLOVER HEALTH and AEGEAN AIRLINES
Assuming the 90 days horizon CLOVER HEALTH INV is expected to generate 2.66 times more return on investment than AEGEAN AIRLINES. However, CLOVER HEALTH is 2.66 times more volatile than AEGEAN AIRLINES. It trades about 0.28 of its potential returns per unit of risk. AEGEAN AIRLINES is currently generating about 0.19 per unit of risk. If you would invest 298.00 in CLOVER HEALTH INV on October 12, 2024 and sell it today you would earn a total of 45.00 from holding CLOVER HEALTH INV or generate 15.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
CLOVER HEALTH INV vs. AEGEAN AIRLINES
Performance |
| Timeline |
| CLOVER HEALTH INV |
| AEGEAN AIRLINES |
CLOVER HEALTH and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CLOVER HEALTH and AEGEAN AIRLINES
The main advantage of trading using opposite CLOVER HEALTH and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CLOVER HEALTH 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.| CLOVER HEALTH vs. TELECOM ITALIA | CLOVER HEALTH vs. Entravision Communications | CLOVER HEALTH vs. Chengdu PUTIAN Telecommunications | CLOVER HEALTH vs. COMBA TELECOM SYST |
| 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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