Correlation Between AerCap Holdings and Emeco Holdings
Can any of the company-specific risk be diversified away by investing in both AerCap Holdings and Emeco Holdings 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 AerCap Holdings and Emeco Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AerCap Holdings NV and Emeco Holdings Limited, you can compare the effects of market volatilities on AerCap Holdings and Emeco Holdings 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 AerCap Holdings with a short position of Emeco Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of AerCap Holdings and Emeco Holdings.
Diversification Opportunities for AerCap Holdings and Emeco Holdings
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AerCap and Emeco is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AerCap Holdings NV and Emeco Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emeco Holdings and AerCap Holdings 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 AerCap Holdings NV are associated (or correlated) with Emeco Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emeco Holdings has no effect on the direction of AerCap Holdings i.e., AerCap Holdings and Emeco Holdings go up and down completely randomly.
Pair Corralation between AerCap Holdings and Emeco Holdings
Considering the 90-day investment horizon AerCap Holdings is expected to generate 1.98 times less return on investment than Emeco Holdings. In addition to that, AerCap Holdings is 1.01 times more volatile than Emeco Holdings Limited. It trades about 0.04 of its total potential returns per unit of risk. Emeco Holdings Limited is currently generating about 0.09 per unit of volatility. If you would invest 42.00 in Emeco Holdings Limited on September 1, 2024 and sell it today you would earn a total of 7.00 from holding Emeco Holdings Limited or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
AerCap Holdings NV vs. Emeco Holdings Limited
Performance |
| Timeline |
| AerCap Holdings NV |
| Emeco Holdings |
AerCap Holdings and Emeco Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AerCap Holdings and Emeco Holdings
The main advantage of trading using opposite AerCap Holdings and Emeco Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AerCap Holdings position performs unexpectedly, Emeco Holdings 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 Emeco Holdings will offset losses from the drop in Emeco Holdings' long position.| AerCap Holdings vs. Ryder System | AerCap Holdings vs. Alta Equipment Group | AerCap Holdings vs. PROG Holdings | AerCap Holdings vs. GATX Corporation |
| Emeco Holdings vs. United Rentals | Emeco Holdings vs. Ashtead Gro | Emeco Holdings vs. Ashtead Group plc | Emeco Holdings vs. AerCap Holdings NV |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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