Correlation Between Aeroports and Grupo Aeroportuario
Can any of the company-specific risk be diversified away by investing in both Aeroports and Grupo Aeroportuario 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 Aeroports and Grupo Aeroportuario into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aeroports de Paris and Grupo Aeroportuario del, you can compare the effects of market volatilities on Aeroports and Grupo Aeroportuario 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 Aeroports with a short position of Grupo Aeroportuario. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeroports and Grupo Aeroportuario.
Diversification Opportunities for Aeroports and Grupo Aeroportuario
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aeroports and Grupo is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Aeroports de Paris and Grupo Aeroportuario del in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Aeroportuario del and Aeroports 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 Aeroports de Paris are associated (or correlated) with Grupo Aeroportuario. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Aeroportuario del has no effect on the direction of Aeroports i.e., Aeroports and Grupo Aeroportuario go up and down completely randomly.
Pair Corralation between Aeroports and Grupo Aeroportuario
Assuming the 90 days horizon Aeroports de Paris is expected to under-perform the Grupo Aeroportuario. But the pink sheet apears to be less risky and, when comparing its historical volatility, Aeroports de Paris is 2.28 times less risky than Grupo Aeroportuario. The pink sheet trades about -0.1 of its potential returns per unit of risk. The Grupo Aeroportuario del is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 17,769 in Grupo Aeroportuario del on August 28, 2024 and sell it today you would earn a total of 576.00 from holding Grupo Aeroportuario del or generate 3.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aeroports de Paris vs. Grupo Aeroportuario del
Performance |
| Timeline |
| Aeroports de Paris |
| Grupo Aeroportuario del |
Aeroports and Grupo Aeroportuario Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aeroports and Grupo Aeroportuario
The main advantage of trading using opposite Aeroports and Grupo Aeroportuario positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aeroports position performs unexpectedly, Grupo Aeroportuario 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 Grupo Aeroportuario will offset losses from the drop in Grupo Aeroportuario's long position.| Aeroports vs. Japan Airport Terminal | Aeroports vs. Aena SME SA | Aeroports vs. Airports of Thailand | Aeroports vs. Aena SME SA |
| Grupo Aeroportuario vs. Grupo Aeroportuario del | Grupo Aeroportuario vs. Corporacion America Airports | Grupo Aeroportuario vs. AerSale Corp | Grupo Aeroportuario vs. Flughafen Zrich AG |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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