Correlation Between AerSale Corp and Bayview Acquisition
Can any of the company-specific risk be diversified away by investing in both AerSale Corp and Bayview Acquisition 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 Bayview Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AerSale Corp and Bayview Acquisition Corp, you can compare the effects of market volatilities on AerSale Corp and Bayview Acquisition 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 Bayview Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of AerSale Corp and Bayview Acquisition.
Diversification Opportunities for AerSale Corp and Bayview Acquisition
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between AerSale and Bayview is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding AerSale Corp and Bayview Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayview Acquisition Corp 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 Bayview Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayview Acquisition Corp has no effect on the direction of AerSale Corp i.e., AerSale Corp and Bayview Acquisition go up and down completely randomly.
Pair Corralation between AerSale Corp and Bayview Acquisition
Given the investment horizon of 90 days AerSale Corp is expected to under-perform the Bayview Acquisition. But the stock apears to be less risky and, when comparing its historical volatility, AerSale Corp is 3.25 times less risky than Bayview Acquisition. The stock trades about -0.07 of its potential returns per unit of risk. The Bayview Acquisition Corp is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 12.00 in Bayview Acquisition Corp on August 26, 2024 and sell it today you would earn a total of 5.00 from holding Bayview Acquisition Corp or generate 41.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 33.73% |
| Values | Daily Returns |
AerSale Corp vs. Bayview Acquisition Corp
Performance |
| Timeline |
| AerSale Corp |
| Bayview Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
AerSale Corp and Bayview Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AerSale Corp and Bayview Acquisition
The main advantage of trading using opposite AerSale Corp and Bayview Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AerSale Corp position performs unexpectedly, Bayview Acquisition 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 Bayview Acquisition will offset losses from the drop in Bayview Acquisition's 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 |
| Bayview Acquisition vs. dMY Squared Technology | Bayview Acquisition vs. Vine Hill Capital | Bayview Acquisition vs. DP Cap Acquisition | Bayview Acquisition vs. PowerUp Acquisition Corp |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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