Correlation Between Alaska Air and Transport International
Can any of the company-specific risk be diversified away by investing in both Alaska Air and Transport International 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 Alaska Air and Transport International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alaska Air Group and Transport International Holdings, you can compare the effects of market volatilities on Alaska Air and Transport International 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 Alaska Air with a short position of Transport International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alaska Air and Transport International.
Diversification Opportunities for Alaska Air and Transport International
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Alaska and Transport is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Alaska Air Group and Transport International Holdin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transport International and Alaska Air 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 Alaska Air Group are associated (or correlated) with Transport International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transport International has no effect on the direction of Alaska Air i.e., Alaska Air and Transport International go up and down completely randomly.
Pair Corralation between Alaska Air and Transport International
Assuming the 90 days horizon Alaska Air Group is expected to generate 4.22 times more return on investment than Transport International. However, Alaska Air is 4.22 times more volatile than Transport International Holdings. It trades about 0.3 of its potential returns per unit of risk. Transport International Holdings is currently generating about -0.07 per unit of risk. If you would invest 4,854 in Alaska Air Group on September 13, 2024 and sell it today you would earn a total of 1,026 from holding Alaska Air Group or generate 21.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Alaska Air Group vs. Transport International Holdin
Performance |
| Timeline |
| Alaska Air Group |
| Transport International |
Alaska Air and Transport International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alaska Air and Transport International
The main advantage of trading using opposite Alaska Air and Transport International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alaska Air position performs unexpectedly, Transport International 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 Transport International will offset losses from the drop in Transport International's long position.| Alaska Air vs. Aluminum of | Alaska Air vs. GRIFFIN MINING LTD | Alaska Air vs. ADRIATIC METALS LS 013355 | Alaska Air vs. SIMS METAL MGT |
| Transport International vs. CSX Corporation | Transport International vs. Westinghouse Air Brake | Transport International vs. Superior Plus Corp | Transport International vs. SIVERS SEMICONDUCTORS AB |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |