Correlation Between Air Lease and Esprinet SpA
Can any of the company-specific risk be diversified away by investing in both Air Lease and Esprinet SpA 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 Esprinet SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Lease and Esprinet SpA, you can compare the effects of market volatilities on Air Lease and Esprinet SpA 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 Esprinet SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Lease and Esprinet SpA.
Diversification Opportunities for Air Lease and Esprinet SpA
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Air and Esprinet is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding Air Lease and Esprinet SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esprinet SpA 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 Esprinet SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esprinet SpA has no effect on the direction of Air Lease i.e., Air Lease and Esprinet SpA go up and down completely randomly.
Pair Corralation between Air Lease and Esprinet SpA
Assuming the 90 days trading horizon Air Lease is expected to generate 0.96 times more return on investment than Esprinet SpA. However, Air Lease is 1.04 times less risky than Esprinet SpA. It trades about 0.04 of its potential returns per unit of risk. Esprinet SpA is currently generating about -0.05 per unit of risk. If you would invest 4,277 in Air Lease on September 29, 2024 and sell it today you would earn a total of 363.00 from holding Air Lease or generate 8.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Lease vs. Esprinet SpA
Performance |
| Timeline |
| Air Lease |
| Esprinet SpA |
Air Lease and Esprinet SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Lease and Esprinet SpA
The main advantage of trading using opposite Air Lease and Esprinet SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Lease position performs unexpectedly, Esprinet SpA 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 Esprinet SpA will offset losses from the drop in Esprinet SpA's long position.| Air Lease vs. Ashtead Group plc | Air Lease vs. WillScot Mobile Mini | Air Lease vs. Avis Budget Group | Air Lease vs. Sixt SE |
| Esprinet SpA vs. Air Lease | Esprinet SpA vs. FUYO GENERAL LEASE | Esprinet SpA vs. Kaufman Broad SA | Esprinet SpA vs. Elmos Semiconductor SE |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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