Correlation Between Alabama Aircraft and Astronics Corp
Can any of the company-specific risk be diversified away by investing in both Alabama Aircraft and Astronics Corp 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 Alabama Aircraft and Astronics Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alabama Aircraft Industries and Astronics Corp Cl, you can compare the effects of market volatilities on Alabama Aircraft and Astronics Corp 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 Alabama Aircraft with a short position of Astronics Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alabama Aircraft and Astronics Corp.
Diversification Opportunities for Alabama Aircraft and Astronics Corp
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alabama and Astronics is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Alabama Aircraft Industries and Astronics Corp Cl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astronics Corp Cl and Alabama Aircraft 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 Alabama Aircraft Industries are associated (or correlated) with Astronics Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astronics Corp Cl has no effect on the direction of Alabama Aircraft i.e., Alabama Aircraft and Astronics Corp go up and down completely randomly.
Pair Corralation between Alabama Aircraft and Astronics Corp
If you would invest 1,506 in Astronics Corp Cl on August 26, 2024 and sell it today you would earn a total of 209.00 from holding Astronics Corp Cl or generate 13.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 0.32% |
| Values | Daily Returns |
Alabama Aircraft Industries vs. Astronics Corp Cl
Performance |
| Timeline |
| Alabama Aircraft Ind |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Astronics Corp Cl |
Alabama Aircraft and Astronics Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alabama Aircraft and Astronics Corp
The main advantage of trading using opposite Alabama Aircraft and Astronics Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alabama Aircraft position performs unexpectedly, Astronics Corp 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 Astronics Corp will offset losses from the drop in Astronics Corp's long position.| Alabama Aircraft vs. World Houseware Limited | Alabama Aircraft vs. Newell Brands | Alabama Aircraft vs. RBC Bearings Incorporated | Alabama Aircraft vs. Dave Busters Entertainment |
| Astronics Corp vs. Firan Technology Group | Astronics Corp vs. 808 Renewable Energy | Astronics Corp vs. Park Electrochemical | Astronics Corp vs. Innovative Solutions and |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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