Correlation Between Eve Holding and Airbus Group
Can any of the company-specific risk be diversified away by investing in both Eve Holding and Airbus Group 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 Eve Holding and Airbus Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eve Holding and Airbus Group NV, you can compare the effects of market volatilities on Eve Holding and Airbus Group 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 Eve Holding with a short position of Airbus Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eve Holding and Airbus Group.
Diversification Opportunities for Eve Holding and Airbus Group
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eve and Airbus is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Eve Holding and Airbus Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airbus Group NV and Eve Holding 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 Eve Holding are associated (or correlated) with Airbus Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airbus Group NV has no effect on the direction of Eve Holding i.e., Eve Holding and Airbus Group go up and down completely randomly.
Pair Corralation between Eve Holding and Airbus Group
Given the investment horizon of 90 days Eve Holding is expected to generate 3.34 times more return on investment than Airbus Group. However, Eve Holding is 3.34 times more volatile than Airbus Group NV. It trades about 0.18 of its potential returns per unit of risk. Airbus Group NV is currently generating about -0.15 per unit of risk. If you would invest 339.00 in Eve Holding on August 29, 2024 and sell it today you would earn a total of 72.00 from holding Eve Holding or generate 21.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eve Holding vs. Airbus Group NV
Performance |
| Timeline |
| Eve Holding |
| Airbus Group NV |
Eve Holding and Airbus Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eve Holding and Airbus Group
The main advantage of trading using opposite Eve Holding and Airbus Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eve Holding position performs unexpectedly, Airbus Group 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 Airbus Group will offset losses from the drop in Airbus Group's long position.| Eve Holding vs. The Boeing | Eve Holding vs. Curtiss Wright | Eve Holding vs. Ehang Holdings | Eve Holding vs. General Dynamics |
| Airbus Group vs. Safran SA | Airbus Group vs. Moog Inc | Airbus Group vs. BAE Systems PLC | Airbus Group vs. Airbus Group SE |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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