Correlation Between Gentera SAB and SkyWest
Can any of the company-specific risk be diversified away by investing in both Gentera SAB and SkyWest 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 Gentera SAB and SkyWest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gentera SAB de and SkyWest, you can compare the effects of market volatilities on Gentera SAB and SkyWest 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 Gentera SAB with a short position of SkyWest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gentera SAB and SkyWest.
Diversification Opportunities for Gentera SAB and SkyWest
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gentera and SkyWest is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Gentera SAB de and SkyWest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SkyWest and Gentera SAB 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 Gentera SAB de are associated (or correlated) with SkyWest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SkyWest has no effect on the direction of Gentera SAB i.e., Gentera SAB and SkyWest go up and down completely randomly.
Pair Corralation between Gentera SAB and SkyWest
Assuming the 90 days horizon Gentera SAB is expected to generate 3.06 times less return on investment than SkyWest. In addition to that, Gentera SAB is 1.03 times more volatile than SkyWest. It trades about 0.05 of its total potential returns per unit of risk. SkyWest is currently generating about 0.15 per unit of volatility. If you would invest 1,833 in SkyWest on August 26, 2024 and sell it today you would earn a total of 9,357 from holding SkyWest or generate 510.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 64.19% |
| Values | Daily Returns |
Gentera SAB de vs. SkyWest
Performance |
| Timeline |
| Gentera SAB de |
| SkyWest |
Gentera SAB and SkyWest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gentera SAB and SkyWest
The main advantage of trading using opposite Gentera SAB and SkyWest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gentera SAB position performs unexpectedly, SkyWest 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 SkyWest will offset losses from the drop in SkyWest's long position.| Gentera SAB vs. Copa Holdings SA | Gentera SAB vs. United Airlines Holdings | Gentera SAB vs. Delta Air Lines | Gentera SAB vs. SkyWest |
| SkyWest vs. Copa Holdings SA | SkyWest vs. Sun Country Airlines | SkyWest vs. Air Transport Services | SkyWest vs. Frontier Group 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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