Correlation Between Air Transport and SIKA AG
Can any of the company-specific risk be diversified away by investing in both Air Transport and SIKA AG 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 SIKA AG 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 SIKA AG UNSPADR, you can compare the effects of market volatilities on Air Transport and SIKA AG 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 SIKA AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Transport and SIKA AG.
Diversification Opportunities for Air Transport and SIKA AG
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Air and SIKA is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Air Transport Services and SIKA AG UNSPADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIKA AG UNSPADR 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 SIKA AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIKA AG UNSPADR has no effect on the direction of Air Transport i.e., Air Transport and SIKA AG go up and down completely randomly.
Pair Corralation between Air Transport and SIKA AG
Assuming the 90 days horizon Air Transport Services is expected to generate 0.2 times more return on investment than SIKA AG. However, Air Transport Services is 5.02 times less risky than SIKA AG. It trades about -0.07 of its potential returns per unit of risk. SIKA AG UNSPADR is currently generating about -0.32 per unit of risk. If you would invest 2,040 in Air Transport Services on January 9, 2025 and sell it today you would lose (20.00) from holding Air Transport Services or give up 0.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Transport Services vs. SIKA AG UNSPADR
Performance |
| Timeline |
| Air Transport Services |
| SIKA AG UNSPADR |
Air Transport and SIKA AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Transport and SIKA AG
The main advantage of trading using opposite Air Transport and SIKA AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Transport position performs unexpectedly, SIKA AG 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 SIKA AG will offset losses from the drop in SIKA AG's long position.| Air Transport vs. Airports of Thailand | Air Transport vs. Airports of Thailand | Air Transport vs. Aena SME SA | Air Transport vs. AENA SME UNSPADR110 |
| SIKA AG vs. RETAIL FOOD GROUP | SIKA AG vs. Air Transport Services | SIKA AG vs. MARKET VECTR RETAIL | SIKA AG vs. Jacquet Metal Service |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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