Correlation Between American Airlines and EMBARK EDUCATION
Can any of the company-specific risk be diversified away by investing in both American Airlines and EMBARK EDUCATION 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 American Airlines and EMBARK EDUCATION into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Airlines Group and EMBARK EDUCATION LTD, you can compare the effects of market volatilities on American Airlines and EMBARK EDUCATION 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 American Airlines with a short position of EMBARK EDUCATION. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Airlines and EMBARK EDUCATION.
Diversification Opportunities for American Airlines and EMBARK EDUCATION
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and EMBARK is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Airlines Group and EMBARK EDUCATION LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMBARK EDUCATION LTD and American Airlines 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 American Airlines Group are associated (or correlated) with EMBARK EDUCATION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMBARK EDUCATION LTD has no effect on the direction of American Airlines i.e., American Airlines and EMBARK EDUCATION go up and down completely randomly.
Pair Corralation between American Airlines and EMBARK EDUCATION
If you would invest 31.00 in EMBARK EDUCATION LTD on December 4, 2024 and sell it today you would earn a total of 0.00 from holding EMBARK EDUCATION LTD or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Airlines Group vs. EMBARK EDUCATION LTD
Performance |
| Timeline |
| American Airlines |
| EMBARK EDUCATION LTD |
American Airlines and EMBARK EDUCATION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Airlines and EMBARK EDUCATION
The main advantage of trading using opposite American Airlines and EMBARK EDUCATION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Airlines position performs unexpectedly, EMBARK EDUCATION 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 EMBARK EDUCATION will offset losses from the drop in EMBARK EDUCATION's long position.| American Airlines vs. Datang International Power | American Airlines vs. NTT DATA | American Airlines vs. PARKEN Sport Entertainment | American Airlines vs. LG Display Co |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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