Correlation Between Air Lease and Global Ship
Can any of the company-specific risk be diversified away by investing in both Air Lease and Global Ship 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 Lease and Global Ship into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Lease and Global Ship Lease, you can compare the effects of market volatilities on Air Lease and Global Ship 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 Lease with a short position of Global Ship. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Lease and Global Ship.
Diversification Opportunities for Air Lease and Global Ship
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Air and Global is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Air Lease and Global Ship Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Ship Lease and Air Lease 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 Lease are associated (or correlated) with Global Ship. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Ship Lease has no effect on the direction of Air Lease i.e., Air Lease and Global Ship go up and down completely randomly.
Pair Corralation between Air Lease and Global Ship
Assuming the 90 days trading horizon Air Lease is expected to generate 0.98 times more return on investment than Global Ship. However, Air Lease is 1.02 times less risky than Global Ship. It trades about 0.18 of its potential returns per unit of risk. Global Ship Lease is currently generating about -0.02 per unit of risk. If you would invest 4,038 in Air Lease on August 28, 2024 and sell it today you would earn a total of 802.00 from holding Air Lease or generate 19.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Lease vs. Global Ship Lease
Performance |
| Timeline |
| Air Lease |
| Global Ship Lease |
Air Lease and Global Ship Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Lease and Global Ship
The main advantage of trading using opposite Air Lease and Global Ship positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Lease position performs unexpectedly, Global Ship 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 Global Ship will offset losses from the drop in Global Ship's long position.| Air Lease vs. SENECA FOODS A | Air Lease vs. TreeHouse Foods | Air Lease vs. Transportadora de Gas | Air Lease vs. BII Railway Transportation |
| Global Ship vs. COSTCO WHOLESALE CDR | Global Ship vs. WisdomTree Investments | Global Ship vs. Apollo Investment Corp | Global Ship vs. Retail Estates NV |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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