Correlation Between Aegean Airlines and Estee Lauder
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Estee Lauder 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 Estee Lauder 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 Estee Lauder Companies, you can compare the effects of market volatilities on Aegean Airlines and Estee Lauder 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 Estee Lauder. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Estee Lauder.
Diversification Opportunities for Aegean Airlines and Estee Lauder
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aegean and Estee is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Estee Lauder Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Estee Lauder Companies 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 Estee Lauder. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Estee Lauder Companies has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Estee Lauder go up and down completely randomly.
Pair Corralation between Aegean Airlines and Estee Lauder
Assuming the 90 days horizon Aegean Airlines SA is expected to generate 0.88 times more return on investment than Estee Lauder. However, Aegean Airlines SA is 1.14 times less risky than Estee Lauder. It trades about 0.07 of its potential returns per unit of risk. Estee Lauder Companies is currently generating about -0.07 per unit of risk. If you would invest 532.00 in Aegean Airlines SA on August 28, 2024 and sell it today you would earn a total of 553.00 from holding Aegean Airlines SA or generate 103.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegean Airlines SA vs. Estee Lauder Companies
Performance |
| Timeline |
| Aegean Airlines SA |
| Estee Lauder Companies |
Aegean Airlines and Estee Lauder Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Estee Lauder
The main advantage of trading using opposite Aegean Airlines and Estee Lauder positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Estee Lauder 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 Estee Lauder will offset losses from the drop in Estee Lauder's long position.| Aegean Airlines vs. Copa Holdings SA | Aegean Airlines vs. United Airlines Holdings | Aegean Airlines vs. Delta Air Lines | Aegean Airlines vs. SkyWest |
| Estee Lauder vs. Honest Company | Estee Lauder vs. Hims Hers Health | Estee Lauder vs. Procter Gamble | Estee Lauder vs. Kimberly Clark |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |