Correlation Between AerSale Corp and Volato
Can any of the company-specific risk be diversified away by investing in both AerSale Corp and Volato 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 Volato into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AerSale Corp and Volato Group, you can compare the effects of market volatilities on AerSale Corp and Volato 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 Volato. Check out your portfolio center. Please also check ongoing floating volatility patterns of AerSale Corp and Volato.
Diversification Opportunities for AerSale Corp and Volato
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AerSale and Volato is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding AerSale Corp and Volato Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Volato Group 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 Volato. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Volato Group has no effect on the direction of AerSale Corp i.e., AerSale Corp and Volato go up and down completely randomly.
Pair Corralation between AerSale Corp and Volato
Given the investment horizon of 90 days AerSale Corp is expected to generate 9.12 times less return on investment than Volato. But when comparing it to its historical volatility, AerSale Corp is 10.76 times less risky than Volato. It trades about 0.2 of its potential returns per unit of risk. Volato Group is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 23.00 in Volato Group on September 5, 2024 and sell it today you would earn a total of 14.00 from holding Volato Group or generate 60.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AerSale Corp vs. Volato Group
Performance |
| Timeline |
| AerSale Corp |
| Volato Group |
AerSale Corp and Volato Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AerSale Corp and Volato
The main advantage of trading using opposite AerSale Corp and Volato positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AerSale Corp position performs unexpectedly, Volato 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 Volato will offset losses from the drop in Volato'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 |
| Volato vs. AerSale Corp | Volato vs. Flughafen Zrich AG | Volato vs. Aquagold International | Volato vs. Thrivent High Yield |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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