Correlation Between Aerodrome and Ilex Medical
Can any of the company-specific risk be diversified away by investing in both Aerodrome and Ilex Medical 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 Aerodrome and Ilex Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aerodrome Group and Ilex Medical, you can compare the effects of market volatilities on Aerodrome and Ilex Medical 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 Aerodrome with a short position of Ilex Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aerodrome and Ilex Medical.
Diversification Opportunities for Aerodrome and Ilex Medical
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aerodrome and Ilex is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Aerodrome Group and Ilex Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ilex Medical and Aerodrome 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 Aerodrome Group are associated (or correlated) with Ilex Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ilex Medical has no effect on the direction of Aerodrome i.e., Aerodrome and Ilex Medical go up and down completely randomly.
Pair Corralation between Aerodrome and Ilex Medical
Assuming the 90 days trading horizon Aerodrome Group is expected to under-perform the Ilex Medical. In addition to that, Aerodrome is 2.78 times more volatile than Ilex Medical. It trades about -0.14 of its total potential returns per unit of risk. Ilex Medical is currently generating about 0.47 per unit of volatility. If you would invest 641,900 in Ilex Medical on September 1, 2024 and sell it today you would earn a total of 144,000 from holding Ilex Medical or generate 22.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aerodrome Group vs. Ilex Medical
Performance |
| Timeline |
| Aerodrome Group |
| Ilex Medical |
Aerodrome and Ilex Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aerodrome and Ilex Medical
The main advantage of trading using opposite Aerodrome and Ilex Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aerodrome position performs unexpectedly, Ilex Medical 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 Ilex Medical will offset losses from the drop in Ilex Medical's long position.| Aerodrome vs. Ilex Medical | Aerodrome vs. Technoplus Ventures | Aerodrome vs. Blender Financial Technologies | Aerodrome vs. YH Dimri Construction |
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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