Correlation Between Aegean Airlines and Liberty Broadband
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Liberty Broadband 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 Liberty Broadband 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 Liberty Broadband Corp, you can compare the effects of market volatilities on Aegean Airlines and Liberty Broadband 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 Liberty Broadband. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Liberty Broadband.
Diversification Opportunities for Aegean Airlines and Liberty Broadband
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Aegean and Liberty is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Liberty Broadband Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liberty Broadband Corp 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 Liberty Broadband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liberty Broadband Corp has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Liberty Broadband go up and down completely randomly.
Pair Corralation between Aegean Airlines and Liberty Broadband
Assuming the 90 days horizon Aegean Airlines SA is expected to generate 2.3 times more return on investment than Liberty Broadband. However, Aegean Airlines is 2.3 times more volatile than Liberty Broadband Corp. It trades about 0.08 of its potential returns per unit of risk. Liberty Broadband Corp is currently generating about 0.04 per unit of risk. If you would invest 512.00 in Aegean Airlines SA on September 12, 2024 and sell it today you would earn a total of 573.00 from holding Aegean Airlines SA or generate 111.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Aegean Airlines SA vs. Liberty Broadband Corp
Performance |
| Timeline |
| Aegean Airlines SA |
| Liberty Broadband Corp |
Aegean Airlines and Liberty Broadband Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Liberty Broadband
The main advantage of trading using opposite Aegean Airlines and Liberty Broadband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Liberty Broadband 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 Liberty Broadband will offset losses from the drop in Liberty Broadband'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 |
| Liberty Broadband vs. AMREP | Liberty Broadband vs. SNDL Inc | Liberty Broadband vs. John Wiley Sons | Liberty Broadband vs. Monster Beverage Corp |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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