Correlation Between Airbus SE and SHELL PLC
Can any of the company-specific risk be diversified away by investing in both Airbus SE and SHELL 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 Airbus SE and SHELL PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airbus SE and SHELL PLC WI, you can compare the effects of market volatilities on Airbus SE and SHELL 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 Airbus SE with a short position of SHELL PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airbus SE and SHELL PLC.
Diversification Opportunities for Airbus SE and SHELL PLC
Weak diversification
The 3 months correlation between Airbus and SHELL is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Airbus SE and SHELL PLC WI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHELL PLC WI and Airbus SE 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 Airbus SE are associated (or correlated) with SHELL PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHELL PLC WI has no effect on the direction of Airbus SE i.e., Airbus SE and SHELL PLC go up and down completely randomly.
Pair Corralation between Airbus SE and SHELL PLC
Assuming the 90 days horizon Airbus SE is expected to under-perform the SHELL PLC. In addition to that, Airbus SE is 1.29 times more volatile than SHELL PLC WI. It trades about -0.01 of its total potential returns per unit of risk. SHELL PLC WI is currently generating about 0.07 per unit of volatility. If you would invest 6,131 in SHELL PLC WI on August 24, 2024 and sell it today you would earn a total of 119.00 from holding SHELL PLC WI or generate 1.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airbus SE vs. SHELL PLC WI
Performance |
| Timeline |
| Airbus SE |
| SHELL PLC WI |
Airbus SE and SHELL PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airbus SE and SHELL PLC
The main advantage of trading using opposite Airbus SE and SHELL PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airbus SE position performs unexpectedly, SHELL 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 SHELL PLC will offset losses from the drop in SHELL PLC's long position.| Airbus SE vs. Hyster Yale Materials Handling | Airbus SE vs. Summit Materials | Airbus SE vs. NEWELL RUBBERMAID | Airbus SE vs. PRECISION DRILLING P |
| SHELL PLC vs. CHINA EDUCATION GROUP | SHELL PLC vs. Adtalem Global Education | SHELL PLC vs. AUSTEVOLL SEAFOOD | SHELL PLC vs. PT Indofood Sukses |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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