Correlation Between Cathay Pacific and Cebu Air
Can any of the company-specific risk be diversified away by investing in both Cathay Pacific and Cebu Air 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 Cathay Pacific and Cebu Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cathay Pacific Airways and Cebu Air, you can compare the effects of market volatilities on Cathay Pacific and Cebu Air 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 Cathay Pacific with a short position of Cebu Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cathay Pacific and Cebu Air.
Diversification Opportunities for Cathay Pacific and Cebu Air
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cathay and Cebu is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cathay Pacific Airways and Cebu Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cebu Air and Cathay Pacific 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 Cathay Pacific Airways are associated (or correlated) with Cebu Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cebu Air has no effect on the direction of Cathay Pacific i.e., Cathay Pacific and Cebu Air go up and down completely randomly.
Pair Corralation between Cathay Pacific and Cebu Air
If you would invest 88.00 in Cathay Pacific Airways on September 2, 2024 and sell it today you would earn a total of 3.00 from holding Cathay Pacific Airways or generate 3.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 26.15% |
| Values | Daily Returns |
Cathay Pacific Airways vs. Cebu Air
Performance |
| Timeline |
| Cathay Pacific Airways |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
| Cebu Air |
Cathay Pacific and Cebu Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cathay Pacific and Cebu Air
The main advantage of trading using opposite Cathay Pacific and Cebu Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cathay Pacific position performs unexpectedly, Cebu Air 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 Cebu Air will offset losses from the drop in Cebu Air's long position.| Cathay Pacific vs. Finnair Oyj | Cathay Pacific vs. easyJet plc | Cathay Pacific vs. Norse Atlantic ASA | Cathay Pacific vs. Air New Zealand |
| Cebu Air vs. Copa Holdings SA | Cebu Air vs. United Airlines Holdings | Cebu Air vs. Delta Air Lines | Cebu Air vs. SkyWest |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |