Correlation Between AGRICULTBK HADR/25 and Air Transport
Can any of the company-specific risk be diversified away by investing in both AGRICULTBK HADR/25 and Air Transport 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 AGRICULTBK HADR/25 and Air Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGRICULTBK HADR25 YC and Air Transport Services, you can compare the effects of market volatilities on AGRICULTBK HADR/25 and Air Transport 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 AGRICULTBK HADR/25 with a short position of Air Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGRICULTBK HADR/25 and Air Transport.
Diversification Opportunities for AGRICULTBK HADR/25 and Air Transport
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AGRICULTBK and Air is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding AGRICULTBK HADR25 YC and Air Transport Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Transport Services and AGRICULTBK HADR/25 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 AGRICULTBK HADR25 YC are associated (or correlated) with Air Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Transport Services has no effect on the direction of AGRICULTBK HADR/25 i.e., AGRICULTBK HADR/25 and Air Transport go up and down completely randomly.
Pair Corralation between AGRICULTBK HADR/25 and Air Transport
Assuming the 90 days trading horizon AGRICULTBK HADR/25 is expected to generate 2.45 times less return on investment than Air Transport. But when comparing it to its historical volatility, AGRICULTBK HADR25 YC is 1.54 times less risky than Air Transport. It trades about 0.09 of its potential returns per unit of risk. Air Transport Services is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,180 in Air Transport Services on September 5, 2024 and sell it today you would earn a total of 900.00 from holding Air Transport Services or generate 76.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.22% |
| Values | Daily Returns |
AGRICULTBK HADR25 YC vs. Air Transport Services
Performance |
| Timeline |
| AGRICULTBK HADR/25 |
| Air Transport Services |
AGRICULTBK HADR/25 and Air Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGRICULTBK HADR/25 and Air Transport
The main advantage of trading using opposite AGRICULTBK HADR/25 and Air Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGRICULTBK HADR/25 position performs unexpectedly, Air Transport 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 Air Transport will offset losses from the drop in Air Transport's long position.| AGRICULTBK HADR/25 vs. SBA Communications Corp | AGRICULTBK HADR/25 vs. WIMFARM SA EO | AGRICULTBK HADR/25 vs. COMBA TELECOM SYST | AGRICULTBK HADR/25 vs. Sumitomo Mitsui Construction |
| Air Transport vs. Airports of Thailand | Air Transport vs. Airports of Thailand | Air Transport vs. Aena SME SA | Air Transport vs. AENA SME UNSPADR110 |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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