Correlation Between Corporacion America and Aena SME
Can any of the company-specific risk be diversified away by investing in both Corporacion America and Aena SME 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 Corporacion America and Aena SME into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corporacion America Airports and Aena SME SA, you can compare the effects of market volatilities on Corporacion America and Aena SME 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 Corporacion America with a short position of Aena SME. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporacion America and Aena SME.
Diversification Opportunities for Corporacion America and Aena SME
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Corporacion and Aena is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Corporacion America Airports and Aena SME SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aena SME SA and Corporacion America 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 Corporacion America Airports are associated (or correlated) with Aena SME. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aena SME SA has no effect on the direction of Corporacion America i.e., Corporacion America and Aena SME go up and down completely randomly.
Pair Corralation between Corporacion America and Aena SME
Given the investment horizon of 90 days Corporacion America Airports is expected to generate 2.02 times more return on investment than Aena SME. However, Corporacion America is 2.02 times more volatile than Aena SME SA. It trades about 0.06 of its potential returns per unit of risk. Aena SME SA is currently generating about -0.14 per unit of risk. If you would invest 1,825 in Corporacion America Airports on August 25, 2024 and sell it today you would earn a total of 50.00 from holding Corporacion America Airports or generate 2.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Corporacion America Airports vs. Aena SME SA
Performance |
| Timeline |
| Corporacion America |
| Aena SME SA |
Corporacion America and Aena SME Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Corporacion America and Aena SME
The main advantage of trading using opposite Corporacion America and Aena SME positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corporacion America position performs unexpectedly, Aena SME 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 Aena SME will offset losses from the drop in Aena SME's long position.| Corporacion America vs. Grupo Aeroportuario del | Corporacion America vs. Grupo Aeroportuario del | Corporacion America vs. AerSale Corp | Corporacion America vs. Flughafen Zrich AG |
| Aena SME vs. Aeroports de Paris | Aena SME vs. Auckland International Airport | Aena SME vs. Auckland International Airport | Aena SME vs. Corporacion America Airports |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |