Correlation Between Air Transport and Takkt AG
Can any of the company-specific risk be diversified away by investing in both Air Transport and Takkt 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 Takkt 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 Takkt AG, you can compare the effects of market volatilities on Air Transport and Takkt 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 Takkt AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Transport and Takkt AG.
Diversification Opportunities for Air Transport and Takkt AG
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Air and Takkt is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Air Transport Services and Takkt AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Takkt AG 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 Takkt AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Takkt AG has no effect on the direction of Air Transport i.e., Air Transport and Takkt AG go up and down completely randomly.
Pair Corralation between Air Transport and Takkt AG
Assuming the 90 days horizon Air Transport Services is expected to generate 4.56 times more return on investment than Takkt AG. However, Air Transport is 4.56 times more volatile than Takkt AG. It trades about 0.29 of its potential returns per unit of risk. Takkt AG is currently generating about -0.5 per unit of risk. If you would invest 1,540 in Air Transport Services on August 28, 2024 and sell it today you would earn a total of 540.00 from holding Air Transport Services or generate 35.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Air Transport Services vs. Takkt AG
Performance |
| Timeline |
| Air Transport Services |
| Takkt AG |
Air Transport and Takkt AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Transport and Takkt AG
The main advantage of trading using opposite Air Transport and Takkt AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Transport position performs unexpectedly, Takkt 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 Takkt AG will offset losses from the drop in Takkt AG's long position.| Air Transport vs. Airports of Thailand | Air Transport vs. Aena SME SA | Air Transport vs. AerCap Holdings NV | Air Transport vs. Grupo Aeroportuario del |
| Takkt AG vs. CarsalesCom | Takkt AG vs. Air Transport Services | Takkt AG vs. INTER CARS SA | Takkt AG vs. Geely Automobile Holdings |
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 Stocks Directory module to find actively traded stocks across global markets.
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