Correlation Between Air Transport and Kerry Logistics
Can any of the company-specific risk be diversified away by investing in both Air Transport and Kerry Logistics 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 Air Transport and Kerry Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Transport Services and Kerry Logistics Network, you can compare the effects of market volatilities on Air Transport and Kerry Logistics 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 Air Transport with a short position of Kerry Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Transport and Kerry Logistics.
Diversification Opportunities for Air Transport and Kerry Logistics
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Air and Kerry is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Air Transport Services and Kerry Logistics Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kerry Logistics Network and Air Transport 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 Air Transport Services are associated (or correlated) with Kerry Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kerry Logistics Network has no effect on the direction of Air Transport i.e., Air Transport and Kerry Logistics go up and down completely randomly.
Pair Corralation between Air Transport and Kerry Logistics
Given the investment horizon of 90 days Air Transport Services is expected to generate 0.57 times more return on investment than Kerry Logistics. However, Air Transport Services is 1.75 times less risky than Kerry Logistics. It trades about 0.09 of its potential returns per unit of risk. Kerry Logistics Network is currently generating about -0.06 per unit of risk. If you would invest 1,276 in Air Transport Services on December 4, 2024 and sell it today you would earn a total of 956.00 from holding Air Transport Services or generate 74.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 53.88% |
| Values | Daily Returns |
Air Transport Services vs. Kerry Logistics Network
Performance |
| Timeline |
| Air Transport Services |
| Kerry Logistics Network |
Air Transport and Kerry Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Transport and Kerry Logistics
The main advantage of trading using opposite Air Transport and Kerry Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Transport position performs unexpectedly, Kerry Logistics 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 Kerry Logistics will offset losses from the drop in Kerry Logistics' long position.| Air Transport vs. Copa Holdings SA | Air Transport vs. SkyWest | Air Transport vs. Sun Country Airlines | Air Transport vs. Frontier Group Holdings |
| Kerry Logistics vs. Universal Display | Kerry Logistics vs. Mattel Inc | Kerry Logistics vs. Guangzhou Automobile Group | Kerry Logistics vs. Sonos Inc |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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