Correlation Between Amedeo Air and Finnair Oyj
Can any of the company-specific risk be diversified away by investing in both Amedeo Air and Finnair Oyj 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 Amedeo Air and Finnair Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amedeo Air Four and Finnair Oyj, you can compare the effects of market volatilities on Amedeo Air and Finnair Oyj 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 Amedeo Air with a short position of Finnair Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amedeo Air and Finnair Oyj.
Diversification Opportunities for Amedeo Air and Finnair Oyj
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Amedeo and Finnair is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Amedeo Air Four and Finnair Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finnair Oyj and Amedeo Air 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 Amedeo Air Four are associated (or correlated) with Finnair Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finnair Oyj has no effect on the direction of Amedeo Air i.e., Amedeo Air and Finnair Oyj go up and down completely randomly.
Pair Corralation between Amedeo Air and Finnair Oyj
Assuming the 90 days trading horizon Amedeo Air Four is expected to generate 0.25 times more return on investment than Finnair Oyj. However, Amedeo Air Four is 4.03 times less risky than Finnair Oyj. It trades about 0.34 of its potential returns per unit of risk. Finnair Oyj is currently generating about 0.01 per unit of risk. If you would invest 5,000 in Amedeo Air Four on September 13, 2024 and sell it today you would earn a total of 420.00 from holding Amedeo Air Four or generate 8.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amedeo Air Four vs. Finnair Oyj
Performance |
| Timeline |
| Amedeo Air Four |
| Finnair Oyj |
Amedeo Air and Finnair Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amedeo Air and Finnair Oyj
The main advantage of trading using opposite Amedeo Air and Finnair Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amedeo Air position performs unexpectedly, Finnair Oyj 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 Finnair Oyj will offset losses from the drop in Finnair Oyj's long position.| Amedeo Air vs. Polar Capital Technology | Amedeo Air vs. Spirent Communications plc | Amedeo Air vs. Monster Beverage Corp | Amedeo Air vs. Cognizant Technology Solutions |
| Finnair Oyj vs. Samsung Electronics Co | Finnair Oyj vs. Samsung Electronics Co | Finnair Oyj vs. Hyundai Motor | Finnair Oyj vs. Reliance Industries Ltd |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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