Correlation Between Airbus Group and Tat Techno
Can any of the company-specific risk be diversified away by investing in both Airbus Group and Tat Techno 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 Airbus Group and Tat Techno into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airbus Group NV and Tat Techno, you can compare the effects of market volatilities on Airbus Group and Tat Techno 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 Airbus Group with a short position of Tat Techno. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airbus Group and Tat Techno.
Diversification Opportunities for Airbus Group and Tat Techno
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Airbus and Tat is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Airbus Group NV and Tat Techno in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tat Techno and Airbus Group 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 Airbus Group NV are associated (or correlated) with Tat Techno. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tat Techno has no effect on the direction of Airbus Group i.e., Airbus Group and Tat Techno go up and down completely randomly.
Pair Corralation between Airbus Group and Tat Techno
Assuming the 90 days horizon Airbus Group NV is expected to under-perform the Tat Techno. But the pink sheet apears to be less risky and, when comparing its historical volatility, Airbus Group NV is 2.58 times less risky than Tat Techno. The pink sheet trades about -0.15 of its potential returns per unit of risk. The Tat Techno is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,857 in Tat Techno on August 29, 2024 and sell it today you would earn a total of 344.00 from holding Tat Techno or generate 18.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airbus Group NV vs. Tat Techno
Performance |
| Timeline |
| Airbus Group NV |
| Tat Techno |
Airbus Group and Tat Techno Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airbus Group and Tat Techno
The main advantage of trading using opposite Airbus Group and Tat Techno positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airbus Group position performs unexpectedly, Tat Techno 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 Tat Techno will offset losses from the drop in Tat Techno's long position.| Airbus Group vs. Safran SA | Airbus Group vs. Moog Inc | Airbus Group vs. BAE Systems PLC | Airbus Group vs. Airbus Group SE |
| Tat Techno vs. Sidus Space | Tat Techno vs. Rocket Lab USA | Tat Techno vs. Momentus | Tat Techno vs. Planet Labs PBC |
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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