Correlation Between CPI Aerostructures and Sky Harbour
Can any of the company-specific risk be diversified away by investing in both CPI Aerostructures and Sky Harbour 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 Aerostructures and Sky Harbour into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPI Aerostructures and Sky Harbour Group, you can compare the effects of market volatilities on CPI Aerostructures and Sky Harbour 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 Aerostructures with a short position of Sky Harbour. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Aerostructures and Sky Harbour.
Diversification Opportunities for CPI Aerostructures and Sky Harbour
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CPI and Sky is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding CPI Aerostructures and Sky Harbour Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sky Harbour Group and CPI Aerostructures 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 Aerostructures are associated (or correlated) with Sky Harbour. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sky Harbour Group has no effect on the direction of CPI Aerostructures i.e., CPI Aerostructures and Sky Harbour go up and down completely randomly.
Pair Corralation between CPI Aerostructures and Sky Harbour
Considering the 90-day investment horizon CPI Aerostructures is expected to generate 1.36 times more return on investment than Sky Harbour. However, CPI Aerostructures is 1.36 times more volatile than Sky Harbour Group. It trades about 0.08 of its potential returns per unit of risk. Sky Harbour Group is currently generating about 0.03 per unit of risk. If you would invest 344.00 in CPI Aerostructures on August 29, 2024 and sell it today you would earn a total of 34.00 from holding CPI Aerostructures or generate 9.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
CPI Aerostructures vs. Sky Harbour Group
Performance |
| Timeline |
| CPI Aerostructures |
| Sky Harbour Group |
CPI Aerostructures and Sky Harbour Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPI Aerostructures and Sky Harbour
The main advantage of trading using opposite CPI Aerostructures and Sky Harbour positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPI Aerostructures position performs unexpectedly, Sky Harbour 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 Sky Harbour will offset losses from the drop in Sky Harbour's long position.| CPI Aerostructures vs. ABIVAX Socit Anonyme | CPI Aerostructures vs. Morningstar Unconstrained Allocation | CPI Aerostructures vs. SPACE | CPI Aerostructures vs. Knife River |
| Sky Harbour vs. Ducommun Incorporated | Sky Harbour vs. Innovative Solutions and | Sky Harbour vs. National Presto Industries | Sky Harbour vs. Astronics |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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