Correlation Between Flexible Solutions and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both Flexible Solutions 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 Flexible Solutions and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flexible Solutions International and Aegean Airlines SA, you can compare the effects of market volatilities on Flexible Solutions 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 Flexible Solutions with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flexible Solutions and Aegean Airlines.
Diversification Opportunities for Flexible Solutions and Aegean Airlines
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Flexible and Aegean is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Flexible Solutions Internation 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 Flexible Solutions 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 Flexible Solutions International 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 Flexible Solutions i.e., Flexible Solutions and Aegean Airlines go up and down completely randomly.
Pair Corralation between Flexible Solutions and Aegean Airlines
Considering the 90-day investment horizon Flexible Solutions International is expected to generate 2.03 times more return on investment than Aegean Airlines. However, Flexible Solutions is 2.03 times more volatile than Aegean Airlines SA. It trades about 0.04 of its potential returns per unit of risk. Aegean Airlines SA is currently generating about -0.21 per unit of risk. If you would invest 394.00 in Flexible Solutions International on August 24, 2024 and sell it today you would earn a total of 8.00 from holding Flexible Solutions International or generate 2.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Flexible Solutions Internation vs. Aegean Airlines SA
Performance |
| Timeline |
| Flexible Solutions |
| Aegean Airlines SA |
Flexible Solutions and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flexible Solutions and Aegean Airlines
The main advantage of trading using opposite Flexible Solutions and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flexible Solutions 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.| Flexible Solutions vs. Eshallgo Class A | Flexible Solutions vs. Amtech Systems | Flexible Solutions vs. Gold Fields Ltd | Flexible Solutions vs. Aegean Airlines SA |
| Aegean Airlines vs. Copa Holdings SA | Aegean Airlines vs. United Airlines Holdings | Aegean Airlines vs. Delta Air Lines | Aegean Airlines vs. SkyWest |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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