Correlation Between Archer Aviation and Blade Air
Can any of the company-specific risk be diversified away by investing in both Archer Aviation and Blade Air 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 Archer Aviation and Blade Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Archer Aviation and Blade Air Mobility, you can compare the effects of market volatilities on Archer Aviation and Blade Air 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 Archer Aviation with a short position of Blade Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Archer Aviation and Blade Air.
Diversification Opportunities for Archer Aviation and Blade Air
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Archer and Blade is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Archer Aviation and Blade Air Mobility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blade Air Mobility and Archer Aviation 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 Archer Aviation are associated (or correlated) with Blade Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blade Air Mobility has no effect on the direction of Archer Aviation i.e., Archer Aviation and Blade Air go up and down completely randomly.
Pair Corralation between Archer Aviation and Blade Air
Given the investment horizon of 90 days Archer Aviation is expected to generate 1.7 times more return on investment than Blade Air. However, Archer Aviation is 1.7 times more volatile than Blade Air Mobility. It trades about 0.43 of its potential returns per unit of risk. Blade Air Mobility is currently generating about -0.11 per unit of risk. If you would invest 312.00 in Archer Aviation on August 24, 2024 and sell it today you would earn a total of 266.00 from holding Archer Aviation or generate 85.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Archer Aviation vs. Blade Air Mobility
Performance |
| Timeline |
| Archer Aviation |
| Blade Air Mobility |
Archer Aviation and Blade Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Archer Aviation and Blade Air
The main advantage of trading using opposite Archer Aviation and Blade Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Archer Aviation position performs unexpectedly, Blade Air 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 Blade Air will offset losses from the drop in Blade Air's long position.| Archer Aviation vs. Vertical Aerospace | Archer Aviation vs. Ehang Holdings | Archer Aviation vs. Rocket Lab USA | Archer Aviation vs. Lilium NV |
| Blade Air vs. Grupo Aeroportuario del | Blade Air vs. Auckland International Airport | Blade Air vs. Aeroports de Paris | Blade Air vs. Aena SME SA |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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