Correlation Between Airbus Group and Iberpapel Gestion
Can any of the company-specific risk be diversified away by investing in both Airbus Group and Iberpapel Gestion 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 Group and Iberpapel Gestion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airbus Group SE and Iberpapel Gestion SA, you can compare the effects of market volatilities on Airbus Group and Iberpapel Gestion 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 Group with a short position of Iberpapel Gestion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airbus Group and Iberpapel Gestion.
Diversification Opportunities for Airbus Group and Iberpapel Gestion
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Airbus and Iberpapel is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Airbus Group SE and Iberpapel Gestion SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iberpapel Gestion and Airbus Group 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 Group SE are associated (or correlated) with Iberpapel Gestion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iberpapel Gestion has no effect on the direction of Airbus Group i.e., Airbus Group and Iberpapel Gestion go up and down completely randomly.
Pair Corralation between Airbus Group and Iberpapel Gestion
Assuming the 90 days trading horizon Airbus Group SE is expected to generate 2.84 times more return on investment than Iberpapel Gestion. However, Airbus Group is 2.84 times more volatile than Iberpapel Gestion SA. It trades about 0.0 of its potential returns per unit of risk. Iberpapel Gestion SA is currently generating about -0.14 per unit of risk. If you would invest 13,984 in Airbus Group SE on August 30, 2024 and sell it today you would lose (16.00) from holding Airbus Group SE or give up 0.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airbus Group SE vs. Iberpapel Gestion SA
Performance |
| Timeline |
| Airbus Group SE |
| Iberpapel Gestion |
Airbus Group and Iberpapel Gestion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airbus Group and Iberpapel Gestion
The main advantage of trading using opposite Airbus Group and Iberpapel Gestion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airbus Group position performs unexpectedly, Iberpapel Gestion 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 Iberpapel Gestion will offset losses from the drop in Iberpapel Gestion's long position.| Airbus Group vs. Atresmedia Corporacin de | Airbus Group vs. Squirrel Media SA | Airbus Group vs. Arrienda Rental Properties | Airbus Group vs. Techo Hogar SOCIMI, |
| Iberpapel Gestion vs. Vidrala SA | Iberpapel Gestion vs. Grupo Catalana Occidente | Iberpapel Gestion vs. Cia de Distribucion | Iberpapel Gestion vs. Viscofan |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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