Correlation Between MYFAIR GOLD and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both MYFAIR GOLD 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 MYFAIR GOLD and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MYFAIR GOLD P and Aegean Airlines SA, you can compare the effects of market volatilities on MYFAIR GOLD 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 MYFAIR GOLD with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of MYFAIR GOLD and Aegean Airlines.
Diversification Opportunities for MYFAIR GOLD and Aegean Airlines
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MYFAIR and Aegean is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding MYFAIR GOLD P 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 MYFAIR GOLD 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 MYFAIR GOLD P 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 MYFAIR GOLD i.e., MYFAIR GOLD and Aegean Airlines go up and down completely randomly.
Pair Corralation between MYFAIR GOLD and Aegean Airlines
Assuming the 90 days horizon MYFAIR GOLD P is expected to generate 2.46 times more return on investment than Aegean Airlines. However, MYFAIR GOLD is 2.46 times more volatile than Aegean Airlines SA. It trades about 0.07 of its potential returns per unit of risk. Aegean Airlines SA is currently generating about -0.16 per unit of risk. If you would invest 109.00 in MYFAIR GOLD P on August 31, 2024 and sell it today you would earn a total of 14.00 from holding MYFAIR GOLD P or generate 12.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MYFAIR GOLD P vs. Aegean Airlines SA
Performance |
| Timeline |
| MYFAIR GOLD P |
| Aegean Airlines SA |
MYFAIR GOLD and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MYFAIR GOLD and Aegean Airlines
The main advantage of trading using opposite MYFAIR GOLD and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MYFAIR GOLD 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.| MYFAIR GOLD vs. ZIJIN MINH UNSPADR20 | MYFAIR GOLD vs. Superior Plus Corp | MYFAIR GOLD vs. NMI Holdings | MYFAIR GOLD vs. Origin Agritech |
| Aegean Airlines vs. RYANAIR HLDGS ADR | Aegean Airlines vs. Southwest Airlines Co | Aegean Airlines vs. Ryanair Holdings plc | Aegean Airlines vs. Superior Plus Corp |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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