Correlation Between Aegean Airlines and BJs Restaurants
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and BJs Restaurants 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 Aegean Airlines and BJs Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegean Airlines SA and BJs Restaurants, you can compare the effects of market volatilities on Aegean Airlines and BJs Restaurants 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 Aegean Airlines with a short position of BJs Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and BJs Restaurants.
Diversification Opportunities for Aegean Airlines and BJs Restaurants
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aegean and BJs is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and BJs Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Restaurants and Aegean 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 Aegean Airlines SA are associated (or correlated) with BJs Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BJs Restaurants has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and BJs Restaurants go up and down completely randomly.
Pair Corralation between Aegean Airlines and BJs Restaurants
Assuming the 90 days horizon Aegean Airlines SA is expected to under-perform the BJs Restaurants. But the pink sheet apears to be less risky and, when comparing its historical volatility, Aegean Airlines SA is 1.68 times less risky than BJs Restaurants. The pink sheet trades about -0.15 of its potential returns per unit of risk. The BJs Restaurants is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 3,272 in BJs Restaurants on September 5, 2024 and sell it today you would earn a total of 462.00 from holding BJs Restaurants or generate 14.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
Aegean Airlines SA vs. BJs Restaurants
Performance |
| Timeline |
| Aegean Airlines SA |
| BJs Restaurants |
Aegean Airlines and BJs Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and BJs Restaurants
The main advantage of trading using opposite Aegean Airlines and BJs Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, BJs Restaurants 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 BJs Restaurants will offset losses from the drop in BJs Restaurants' long position.| Aegean Airlines vs. Copa Holdings SA | Aegean Airlines vs. United Airlines Holdings | Aegean Airlines vs. Delta Air Lines | Aegean Airlines vs. SkyWest |
| BJs Restaurants vs. Dine Brands Global | BJs Restaurants vs. Brinker International | BJs Restaurants vs. Bloomin Brands | BJs Restaurants vs. The Cheesecake Factory |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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