Correlation Between Alaska Air and Mid-Atlantic Home
Can any of the company-specific risk be diversified away by investing in both Alaska Air and Mid-Atlantic Home 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 Mid-Atlantic Home 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 Mid Atlantic Home Health, you can compare the effects of market volatilities on Alaska Air and Mid-Atlantic Home 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 Mid-Atlantic Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alaska Air and Mid-Atlantic Home.
Diversification Opportunities for Alaska Air and Mid-Atlantic Home
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alaska and Mid-Atlantic is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alaska Air Group and Mid Atlantic Home Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mid Atlantic Home 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 Mid-Atlantic Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mid Atlantic Home has no effect on the direction of Alaska Air i.e., Alaska Air and Mid-Atlantic Home go up and down completely randomly.
Pair Corralation between Alaska Air and Mid-Atlantic Home
If you would invest 3,575 in Alaska Air Group on August 28, 2024 and sell it today you would earn a total of 1,769 from holding Alaska Air Group or generate 49.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alaska Air Group vs. Mid Atlantic Home Health
Performance |
| Timeline |
| Alaska Air Group |
| Mid Atlantic Home |
Alaska Air and Mid-Atlantic Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alaska Air and Mid-Atlantic Home
The main advantage of trading using opposite Alaska Air and Mid-Atlantic Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alaska Air position performs unexpectedly, Mid-Atlantic Home 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 Mid-Atlantic Home will offset losses from the drop in Mid-Atlantic Home's long position.| Alaska Air vs. Delta Air Lines | Alaska Air vs. United Airlines Holdings | Alaska Air vs. American Airlines Group | Alaska Air vs. JetBlue Airways Corp |
| Mid-Atlantic Home vs. IMAC Holdings | Mid-Atlantic Home vs. HCA Holdings | Mid-Atlantic Home vs. HUMANA INC | Mid-Atlantic Home vs. SCOR PK |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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