Correlation Between FAST RETAIL and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both FAST RETAIL 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 FAST RETAIL and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FAST RETAIL ADR and Aegean Airlines SA, you can compare the effects of market volatilities on FAST RETAIL 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 FAST RETAIL with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of FAST RETAIL and Aegean Airlines.
Diversification Opportunities for FAST RETAIL and Aegean Airlines
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FAST and Aegean is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding FAST RETAIL ADR 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 FAST RETAIL 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 FAST RETAIL ADR 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 FAST RETAIL i.e., FAST RETAIL and Aegean Airlines go up and down completely randomly.
Pair Corralation between FAST RETAIL and Aegean Airlines
Assuming the 90 days trading horizon FAST RETAIL ADR is expected to generate 1.23 times more return on investment than Aegean Airlines. However, FAST RETAIL is 1.23 times more volatile than Aegean Airlines SA. It trades about 0.16 of its potential returns per unit of risk. Aegean Airlines SA is currently generating about -0.08 per unit of risk. If you would invest 2,760 in FAST RETAIL ADR on September 12, 2024 and sell it today you would earn a total of 580.00 from holding FAST RETAIL ADR or generate 21.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FAST RETAIL ADR vs. Aegean Airlines SA
Performance |
| Timeline |
| FAST RETAIL ADR |
| Aegean Airlines SA |
FAST RETAIL and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FAST RETAIL and Aegean Airlines
The main advantage of trading using opposite FAST RETAIL and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FAST RETAIL 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.| FAST RETAIL vs. CCC SA | FAST RETAIL vs. AOYAMA TRADING | FAST RETAIL vs. Superior Plus Corp | FAST RETAIL vs. SIVERS SEMICONDUCTORS AB |
| Aegean Airlines vs. RYANAIR HLDGS ADR | Aegean Airlines vs. Ryanair Holdings plc | Aegean Airlines vs. Superior Plus Corp | Aegean Airlines vs. SIVERS SEMICONDUCTORS AB |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |