Correlation Between Air Transport and Proficient Auto
Can any of the company-specific risk be diversified away by investing in both Air Transport and Proficient Auto 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 Proficient Auto 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 Proficient Auto Logistics,, you can compare the effects of market volatilities on Air Transport and Proficient Auto 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 Proficient Auto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Transport and Proficient Auto.
Diversification Opportunities for Air Transport and Proficient Auto
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Air and Proficient is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Air Transport Services and Proficient Auto Logistics, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proficient Auto Logi 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 Proficient Auto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Proficient Auto Logi has no effect on the direction of Air Transport i.e., Air Transport and Proficient Auto go up and down completely randomly.
Pair Corralation between Air Transport and Proficient Auto
Given the investment horizon of 90 days Air Transport Services is expected to generate 0.9 times more return on investment than Proficient Auto. However, Air Transport Services is 1.11 times less risky than Proficient Auto. It trades about 0.03 of its potential returns per unit of risk. Proficient Auto Logistics, is currently generating about -0.05 per unit of risk. If you would invest 1,874 in Air Transport Services on August 31, 2024 and sell it today you would earn a total of 322.00 from holding Air Transport Services or generate 17.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 38.24% |
| Values | Daily Returns |
Air Transport Services vs. Proficient Auto Logistics,
Performance |
| Timeline |
| Air Transport Services |
| Proficient Auto Logi |
Air Transport and Proficient Auto Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Transport and Proficient Auto
The main advantage of trading using opposite Air Transport and Proficient Auto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Transport position performs unexpectedly, Proficient Auto 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 Proficient Auto will offset losses from the drop in Proficient Auto's long position.| Air Transport vs. Copa Holdings SA | Air Transport vs. SkyWest | Air Transport vs. Sun Country Airlines | Air Transport vs. Frontier Group Holdings |
| Proficient Auto vs. CDW Corp | Proficient Auto vs. Asure Software | Proficient Auto vs. Electrovaya Common Shares | Proficient Auto vs. Hurco Companies |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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