Correlation Between Alaska Air and BingEx
Can any of the company-specific risk be diversified away by investing in both Alaska Air and BingEx 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 BingEx 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 BingEx, you can compare the effects of market volatilities on Alaska Air and BingEx 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 BingEx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alaska Air and BingEx.
Diversification Opportunities for Alaska Air and BingEx
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Alaska and BingEx is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Alaska Air Group and BingEx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BingEx 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 BingEx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BingEx has no effect on the direction of Alaska Air i.e., Alaska Air and BingEx go up and down completely randomly.
Pair Corralation between Alaska Air and BingEx
Considering the 90-day investment horizon Alaska Air Group is expected to generate 0.3 times more return on investment than BingEx. However, Alaska Air Group is 3.36 times less risky than BingEx. It trades about 0.31 of its potential returns per unit of risk. BingEx is currently generating about -0.4 per unit of risk. If you would invest 4,723 in Alaska Air Group on September 4, 2024 and sell it today you would earn a total of 593.00 from holding Alaska Air Group or generate 12.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alaska Air Group vs. BingEx
Performance |
| Timeline |
| Alaska Air Group |
| BingEx |
Alaska Air and BingEx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alaska Air and BingEx
The main advantage of trading using opposite Alaska Air and BingEx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alaska Air position performs unexpectedly, BingEx 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 BingEx will offset losses from the drop in BingEx's long position.| Alaska Air vs. Delta Air Lines | Alaska Air vs. United Airlines Holdings | Alaska Air vs. Frontier Group Holdings |
| BingEx vs. Grupo Simec SAB | BingEx vs. LENSAR Inc | BingEx vs. Cardinal Health | BingEx vs. Alaska Air Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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