Correlation Between DALATA HOTEL and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both DALATA HOTEL 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 DALATA HOTEL and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DALATA HOTEL and Aegean Airlines SA, you can compare the effects of market volatilities on DALATA HOTEL 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 DALATA HOTEL with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of DALATA HOTEL and Aegean Airlines.
Diversification Opportunities for DALATA HOTEL and Aegean Airlines
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DALATA and Aegean is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding DALATA HOTEL 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 DALATA HOTEL 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 DALATA HOTEL 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 DALATA HOTEL i.e., DALATA HOTEL and Aegean Airlines go up and down completely randomly.
Pair Corralation between DALATA HOTEL and Aegean Airlines
Assuming the 90 days trading horizon DALATA HOTEL is expected to generate 1.62 times more return on investment than Aegean Airlines. However, DALATA HOTEL is 1.62 times more volatile than Aegean Airlines SA. It trades about 0.02 of its potential returns per unit of risk. Aegean Airlines SA is currently generating about -0.01 per unit of risk. If you would invest 421.00 in DALATA HOTEL on August 28, 2024 and sell it today you would lose (7.00) from holding DALATA HOTEL or give up 1.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
DALATA HOTEL vs. Aegean Airlines SA
Performance |
| Timeline |
| DALATA HOTEL |
| Aegean Airlines SA |
DALATA HOTEL and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DALATA HOTEL and Aegean Airlines
The main advantage of trading using opposite DALATA HOTEL and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DALATA HOTEL 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.| DALATA HOTEL vs. Apple Inc | DALATA HOTEL vs. Apple Inc | DALATA HOTEL vs. Microsoft | DALATA HOTEL vs. Microsoft |
| Aegean Airlines vs. Zoom Video Communications | Aegean Airlines vs. Singapore Telecommunications Limited | Aegean Airlines vs. Ribbon Communications | Aegean Airlines vs. AWILCO DRILLING PLC |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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