Correlation Between Aegean Airlines and Western Digital
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Western Digital 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 Western Digital 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 Western Digital, you can compare the effects of market volatilities on Aegean Airlines and Western Digital 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 Western Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Western Digital.
Diversification Opportunities for Aegean Airlines and Western Digital
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aegean and Western is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Western Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Digital 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 Western Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Digital has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Western Digital go up and down completely randomly.
Pair Corralation between Aegean Airlines and Western Digital
Assuming the 90 days horizon Aegean Airlines SA is expected to under-perform the Western Digital. But the pink sheet apears to be less risky and, when comparing its historical volatility, Aegean Airlines SA is 1.19 times less risky than Western Digital. The pink sheet trades about -0.22 of its potential returns per unit of risk. The Western Digital is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 6,522 in Western Digital on September 3, 2024 and sell it today you would earn a total of 777.00 from holding Western Digital or generate 11.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Aegean Airlines SA vs. Western Digital
Performance |
| Timeline |
| Aegean Airlines SA |
| Western Digital |
Aegean Airlines and Western Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Western Digital
The main advantage of trading using opposite Aegean Airlines and Western Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Western Digital 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 Western Digital will offset losses from the drop in Western Digital'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 |
| Western Digital vs. NetApp Inc | Western Digital vs. Logitech International SA | Western Digital vs. HP Inc | Western Digital vs. Dell Technologies |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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