Correlation Between American Airlines and Usio
Can any of the company-specific risk be diversified away by investing in both American Airlines and Usio 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 Usio 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 Usio Inc, you can compare the effects of market volatilities on American Airlines and Usio 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 Usio. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Airlines and Usio.
Diversification Opportunities for American Airlines and Usio
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between American and Usio is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding American Airlines Group and Usio Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Usio Inc 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 Usio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Usio Inc has no effect on the direction of American Airlines i.e., American Airlines and Usio go up and down completely randomly.
Pair Corralation between American Airlines and Usio
Considering the 90-day investment horizon American Airlines Group is expected to generate 0.8 times more return on investment than Usio. However, American Airlines Group is 1.26 times less risky than Usio. It trades about 0.01 of its potential returns per unit of risk. Usio Inc is currently generating about -0.01 per unit of risk. If you would invest 1,530 in American Airlines Group on August 31, 2024 and sell it today you would lose (78.00) from holding American Airlines Group or give up 5.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Airlines Group vs. Usio Inc
Performance |
| Timeline |
| American Airlines |
| Usio Inc |
American Airlines and Usio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Airlines and Usio
The main advantage of trading using opposite American Airlines and Usio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Airlines position performs unexpectedly, Usio 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 Usio will offset losses from the drop in Usio'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 |
| Usio vs. Appen Limited | Usio vs. Value Exchange International | Usio vs. Appen Limited | Usio vs. Deveron 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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