Correlation Between Air Transport and Great Portland
Can any of the company-specific risk be diversified away by investing in both Air Transport and Great Portland 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 Great Portland 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 Great Portland Estates, you can compare the effects of market volatilities on Air Transport and Great Portland 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 Great Portland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Transport and Great Portland.
Diversification Opportunities for Air Transport and Great Portland
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Air and Great is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Air Transport Services and Great Portland Estates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great Portland Estates 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 Great Portland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great Portland Estates has no effect on the direction of Air Transport i.e., Air Transport and Great Portland go up and down completely randomly.
Pair Corralation between Air Transport and Great Portland
Assuming the 90 days horizon Air Transport Services is expected to generate 1.14 times more return on investment than Great Portland. However, Air Transport is 1.14 times more volatile than Great Portland Estates. It trades about 0.0 of its potential returns per unit of risk. Great Portland Estates is currently generating about -0.04 per unit of risk. If you would invest 2,600 in Air Transport Services on October 28, 2024 and sell it today you would lose (480.00) from holding Air Transport Services or give up 18.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Transport Services vs. Great Portland Estates
Performance |
| Timeline |
| Air Transport Services |
| Great Portland Estates |
Air Transport and Great Portland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Transport and Great Portland
The main advantage of trading using opposite Air Transport and Great Portland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Transport position performs unexpectedly, Great Portland 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 Great Portland will offset losses from the drop in Great Portland's long position.| Air Transport vs. DALATA HOTEL | Air Transport vs. Easy Software AG | Air Transport vs. Hemisphere Energy Corp | Air Transport vs. COMPUTERSHARE |
| Great Portland vs. Office Properties Income | Great Portland vs. CITY OFFICE REIT | Great Portland vs. CREMECOMTRSBI DL 001 |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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