Correlation Between Aegean Airlines and TotalEnergies
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and TotalEnergies 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 TotalEnergies 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 TotalEnergies SE ADR, you can compare the effects of market volatilities on Aegean Airlines and TotalEnergies 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 TotalEnergies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and TotalEnergies.
Diversification Opportunities for Aegean Airlines and TotalEnergies
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aegean and TotalEnergies is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and TotalEnergies SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TotalEnergies SE ADR 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 TotalEnergies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TotalEnergies SE ADR has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and TotalEnergies go up and down completely randomly.
Pair Corralation between Aegean Airlines and TotalEnergies
Assuming the 90 days horizon Aegean Airlines SA is expected to under-perform the TotalEnergies. In addition to that, Aegean Airlines is 1.84 times more volatile than TotalEnergies SE ADR. It trades about -0.22 of its total potential returns per unit of risk. TotalEnergies SE ADR is currently generating about -0.39 per unit of volatility. If you would invest 6,470 in TotalEnergies SE ADR on August 28, 2024 and sell it today you would lose (644.00) from holding TotalEnergies SE ADR or give up 9.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegean Airlines SA vs. TotalEnergies SE ADR
Performance |
| Timeline |
| Aegean Airlines SA |
| TotalEnergies SE ADR |
Aegean Airlines and TotalEnergies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and TotalEnergies
The main advantage of trading using opposite Aegean Airlines and TotalEnergies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, TotalEnergies 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 TotalEnergies will offset losses from the drop in TotalEnergies' long position.| Aegean Airlines vs. Copa Holdings SA | Aegean Airlines vs. United Airlines Holdings | Aegean Airlines vs. Delta Air Lines | Aegean Airlines vs. SkyWest |
| TotalEnergies vs. BP PLC ADR | TotalEnergies vs. Chevron Corp | TotalEnergies vs. Exxon Mobil Corp | TotalEnergies vs. Equinor ASA ADR |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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