Correlation Between BWX Technologies and Airbus Group
Can any of the company-specific risk be diversified away by investing in both BWX Technologies and Airbus Group 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 BWX Technologies and Airbus Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BWX Technologies and Airbus Group SE, you can compare the effects of market volatilities on BWX Technologies and Airbus Group 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 BWX Technologies with a short position of Airbus Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of BWX Technologies and Airbus Group.
Diversification Opportunities for BWX Technologies and Airbus Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BWX and Airbus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BWX Technologies and Airbus Group SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airbus Group SE and BWX Technologies 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 BWX Technologies are associated (or correlated) with Airbus Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airbus Group SE has no effect on the direction of BWX Technologies i.e., BWX Technologies and Airbus Group go up and down completely randomly.
Pair Corralation between BWX Technologies and Airbus Group
Given the investment horizon of 90 days BWX Technologies is expected to generate 0.86 times more return on investment than Airbus Group. However, BWX Technologies is 1.16 times less risky than Airbus Group. It trades about 0.26 of its potential returns per unit of risk. Airbus Group SE is currently generating about -0.03 per unit of risk. If you would invest 10,849 in BWX Technologies on August 29, 2024 and sell it today you would earn a total of 2,387 from holding BWX Technologies or generate 22.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 97.67% |
| Values | Daily Returns |
BWX Technologies vs. Airbus Group SE
Performance |
| Timeline |
| BWX Technologies |
| Airbus Group SE |
BWX Technologies and Airbus Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BWX Technologies and Airbus Group
The main advantage of trading using opposite BWX Technologies and Airbus Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BWX Technologies position performs unexpectedly, Airbus Group 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 Airbus Group will offset losses from the drop in Airbus Group's long position.| BWX Technologies vs. Nauticus Robotics | BWX Technologies vs. Innovative Solutions and | BWX Technologies vs. National Presto Industries | BWX Technologies vs. Hexcel |
| Airbus Group vs. Airbus Group NV | Airbus Group vs. Park Electrochemical | Airbus Group vs. Rolls Royce Holdings PLC | Airbus Group vs. Triumph Group |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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