Correlation Between Armada Hflr and EasyJet PLC
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and EasyJet PLC 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 Armada Hflr and EasyJet PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and EasyJet PLC, you can compare the effects of market volatilities on Armada Hflr and EasyJet PLC 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 Armada Hflr with a short position of EasyJet PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and EasyJet PLC.
Diversification Opportunities for Armada Hflr and EasyJet PLC
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Armada and EasyJet is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and EasyJet PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EasyJet PLC and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with EasyJet PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EasyJet PLC has no effect on the direction of Armada Hflr i.e., Armada Hflr and EasyJet PLC go up and down completely randomly.
Pair Corralation between Armada Hflr and EasyJet PLC
Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the EasyJet PLC. In addition to that, Armada Hflr is 1.13 times more volatile than EasyJet PLC. It trades about -0.27 of its total potential returns per unit of risk. EasyJet PLC is currently generating about 0.26 per unit of volatility. If you would invest 53,840 in EasyJet PLC on September 24, 2024 and sell it today you would earn a total of 3,320 from holding EasyJet PLC or generate 6.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Armada Hflr Pr vs. EasyJet PLC
Performance |
| Timeline |
| Armada Hflr Pr |
| EasyJet PLC |
Armada Hflr and EasyJet PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Armada Hflr and EasyJet PLC
The main advantage of trading using opposite Armada Hflr and EasyJet PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, EasyJet PLC 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 EasyJet PLC will offset losses from the drop in EasyJet PLC's long position.| Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
| EasyJet PLC vs. Quadrise Plc | EasyJet PLC vs. ImmuPharma PLC | EasyJet PLC vs. Intuitive Investments Group | EasyJet PLC vs. European Metals Holdings |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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