Correlation Between American Airlines and Palfinger
Can any of the company-specific risk be diversified away by investing in both American Airlines and Palfinger 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 Palfinger 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 Palfinger AG, you can compare the effects of market volatilities on American Airlines and Palfinger 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 Palfinger. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Airlines and Palfinger.
Diversification Opportunities for American Airlines and Palfinger
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between American and Palfinger is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding American Airlines Group and Palfinger AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Palfinger AG 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 Palfinger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Palfinger AG has no effect on the direction of American Airlines i.e., American Airlines and Palfinger go up and down completely randomly.
Pair Corralation between American Airlines and Palfinger
If you would invest 1,391 in American Airlines Group on September 13, 2024 and sell it today you would earn a total of 353.50 from holding American Airlines Group or generate 25.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Airlines Group vs. Palfinger AG
Performance |
| Timeline |
| American Airlines |
| Palfinger AG |
American Airlines and Palfinger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Airlines and Palfinger
The main advantage of trading using opposite American Airlines and Palfinger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Airlines position performs unexpectedly, Palfinger 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 Palfinger will offset losses from the drop in Palfinger's long position.| American Airlines vs. Delta Air Lines | American Airlines vs. Southwest Airlines | American Airlines vs. JetBlue Airways Corp | American Airlines vs. United Airlines Holdings |
| Palfinger vs. NetEase | Palfinger vs. Asure Software | Palfinger vs. Plexus Corp | Palfinger vs. Definitive Healthcare 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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