Correlation Between AerSale Corp and Aeroports
Can any of the company-specific risk be diversified away by investing in both AerSale Corp and Aeroports 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 AerSale Corp and Aeroports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AerSale Corp and Aeroports de Paris, you can compare the effects of market volatilities on AerSale Corp and Aeroports 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 AerSale Corp with a short position of Aeroports. Check out your portfolio center. Please also check ongoing floating volatility patterns of AerSale Corp and Aeroports.
Diversification Opportunities for AerSale Corp and Aeroports
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AerSale and Aeroports is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding AerSale Corp and Aeroports de Paris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeroports de Paris and AerSale Corp 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 AerSale Corp are associated (or correlated) with Aeroports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeroports de Paris has no effect on the direction of AerSale Corp i.e., AerSale Corp and Aeroports go up and down completely randomly.
Pair Corralation between AerSale Corp and Aeroports
Given the investment horizon of 90 days AerSale Corp is expected to under-perform the Aeroports. But the stock apears to be less risky and, when comparing its historical volatility, AerSale Corp is 1.16 times less risky than Aeroports. The stock trades about -0.04 of its potential returns per unit of risk. The Aeroports de Paris is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 14,081 in Aeroports de Paris on August 25, 2024 and sell it today you would lose (2,706) from holding Aeroports de Paris or give up 19.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 64.79% |
| Values | Daily Returns |
AerSale Corp vs. Aeroports de Paris
Performance |
| Timeline |
| AerSale Corp |
| Aeroports de Paris |
AerSale Corp and Aeroports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AerSale Corp and Aeroports
The main advantage of trading using opposite AerSale Corp and Aeroports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AerSale Corp position performs unexpectedly, Aeroports 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 Aeroports will offset losses from the drop in Aeroports' long position.| AerSale Corp vs. Grupo Aeroportuario del | AerSale Corp vs. Grupo Aeroportuario del | AerSale Corp vs. Corporacion America Airports | AerSale Corp vs. Aeroports de Paris |
| Aeroports vs. Aeroports de Paris | Aeroports vs. Aena SME SA | Aeroports vs. Auckland International Airport | Aeroports vs. Auckland International Airport |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |