Correlation Between CPI Computer and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both CPI Computer and Aegean Airlines 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 CPI Computer and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPI Computer Peripherals and Aegean Airlines SA, you can compare the effects of market volatilities on CPI Computer and Aegean Airlines 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 CPI Computer with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Computer and Aegean Airlines.
Diversification Opportunities for CPI Computer and Aegean Airlines
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CPI and Aegean is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding CPI Computer Peripherals and Aegean Airlines SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegean Airlines SA and CPI Computer 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 CPI Computer Peripherals are associated (or correlated) with Aegean Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegean Airlines SA has no effect on the direction of CPI Computer i.e., CPI Computer and Aegean Airlines go up and down completely randomly.
Pair Corralation between CPI Computer and Aegean Airlines
Assuming the 90 days trading horizon CPI Computer Peripherals is expected to generate 1.67 times more return on investment than Aegean Airlines. However, CPI Computer is 1.67 times more volatile than Aegean Airlines SA. It trades about -0.12 of its potential returns per unit of risk. Aegean Airlines SA is currently generating about -0.2 per unit of risk. If you would invest 55.00 in CPI Computer Peripherals on August 27, 2024 and sell it today you would lose (3.00) from holding CPI Computer Peripherals or give up 5.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CPI Computer Peripherals vs. Aegean Airlines SA
Performance |
| Timeline |
| CPI Computer Peripherals |
| Aegean Airlines SA |
CPI Computer and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPI Computer and Aegean Airlines
The main advantage of trading using opposite CPI Computer and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPI Computer position performs unexpectedly, Aegean Airlines 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 Aegean Airlines will offset losses from the drop in Aegean Airlines' long position.| CPI Computer vs. Performance Technologies SA | CPI Computer vs. National Bank of | CPI Computer vs. EL D Mouzakis | CPI Computer vs. Lampsa Hellenic Hotels |
| Aegean Airlines vs. Mytilineos SA | Aegean Airlines vs. Greek Organization of | Aegean Airlines vs. Motor Oil Corinth | Aegean Airlines vs. Alpha Services and |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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