Correlation Between FTAI Aviation and MISUMI
Can any of the company-specific risk be diversified away by investing in both FTAI Aviation and MISUMI 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 FTAI Aviation and MISUMI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FTAI Aviation Ltd and MISUMI Group, you can compare the effects of market volatilities on FTAI Aviation and MISUMI 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 FTAI Aviation with a short position of MISUMI. Check out your portfolio center. Please also check ongoing floating volatility patterns of FTAI Aviation and MISUMI.
Diversification Opportunities for FTAI Aviation and MISUMI
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FTAI and MISUMI is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FTAI Aviation Ltd and MISUMI Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MISUMI Group and FTAI Aviation 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 FTAI Aviation Ltd are associated (or correlated) with MISUMI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MISUMI Group has no effect on the direction of FTAI Aviation i.e., FTAI Aviation and MISUMI go up and down completely randomly.
Pair Corralation between FTAI Aviation and MISUMI
Assuming the 90 days horizon FTAI Aviation is expected to generate 1.05 times less return on investment than MISUMI. But when comparing it to its historical volatility, FTAI Aviation Ltd is 1.76 times less risky than MISUMI. It trades about 0.13 of its potential returns per unit of risk. MISUMI Group is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,588 in MISUMI Group on September 3, 2024 and sell it today you would earn a total of 222.00 from holding MISUMI Group or generate 13.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 76.75% |
| Values | Daily Returns |
FTAI Aviation Ltd vs. MISUMI Group
Performance |
| Timeline |
| FTAI Aviation |
| MISUMI Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FTAI Aviation and MISUMI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FTAI Aviation and MISUMI
The main advantage of trading using opposite FTAI Aviation and MISUMI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FTAI Aviation position performs unexpectedly, MISUMI 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 MISUMI will offset losses from the drop in MISUMI's long position.| FTAI Aviation vs. Ryder System | FTAI Aviation vs. Air Lease | FTAI Aviation vs. Vestis | FTAI Aviation vs. Willis Lease Finance |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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