Correlation Between Aena SA and Acerinox
Can any of the company-specific risk be diversified away by investing in both Aena SA and Acerinox 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 Aena SA and Acerinox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aena SA and Acerinox, you can compare the effects of market volatilities on Aena SA and Acerinox 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 Aena SA with a short position of Acerinox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aena SA and Acerinox.
Diversification Opportunities for Aena SA and Acerinox
Very good diversification
The 3 months correlation between Aena and Acerinox is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Aena SA and Acerinox in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acerinox and Aena SA 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 Aena SA are associated (or correlated) with Acerinox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acerinox has no effect on the direction of Aena SA i.e., Aena SA and Acerinox go up and down completely randomly.
Pair Corralation between Aena SA and Acerinox
Assuming the 90 days trading horizon Aena SA is expected to generate 0.85 times more return on investment than Acerinox. However, Aena SA is 1.18 times less risky than Acerinox. It trades about 0.08 of its potential returns per unit of risk. Acerinox is currently generating about 0.01 per unit of risk. If you would invest 14,204 in Aena SA on August 29, 2024 and sell it today you would earn a total of 5,916 from holding Aena SA or generate 41.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aena SA vs. Acerinox
Performance |
| Timeline |
| Aena SA |
| Acerinox |
Aena SA and Acerinox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aena SA and Acerinox
The main advantage of trading using opposite Aena SA and Acerinox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aena SA position performs unexpectedly, Acerinox 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 Acerinox will offset losses from the drop in Acerinox's long position.| Aena SA vs. Azaria Rental SOCIMI | Aena SA vs. Technomeca Aerospace SA | Aena SA vs. Borges Agricultural Industrial | Aena SA vs. Ebro Foods |
| Acerinox vs. ACS Actividades de | Acerinox vs. ArcelorMittal SA | Acerinox vs. Mapfre | Acerinox vs. Ferrovial |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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