Correlation Between FTAI Aviation and Uber Technologies
Can any of the company-specific risk be diversified away by investing in both FTAI Aviation and Uber Technologies 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 Uber Technologies 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 Uber Technologies, you can compare the effects of market volatilities on FTAI Aviation and Uber Technologies 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 Uber Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of FTAI Aviation and Uber Technologies.
Diversification Opportunities for FTAI Aviation and Uber Technologies
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FTAI and Uber is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding FTAI Aviation Ltd and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies 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 Uber Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uber Technologies has no effect on the direction of FTAI Aviation i.e., FTAI Aviation and Uber Technologies go up and down completely randomly.
Pair Corralation between FTAI Aviation and Uber Technologies
Assuming the 90 days horizon FTAI Aviation Ltd is expected to generate 0.31 times more return on investment than Uber Technologies. However, FTAI Aviation Ltd is 3.26 times less risky than Uber Technologies. It trades about 0.06 of its potential returns per unit of risk. Uber Technologies is currently generating about -0.04 per unit of risk. If you would invest 2,554 in FTAI Aviation Ltd on September 12, 2024 and sell it today you would earn a total of 77.00 from holding FTAI Aviation Ltd or generate 3.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
FTAI Aviation Ltd vs. Uber Technologies
Performance |
| Timeline |
| FTAI Aviation |
| Uber Technologies |
FTAI Aviation and Uber Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FTAI Aviation and Uber Technologies
The main advantage of trading using opposite FTAI Aviation and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FTAI Aviation position performs unexpectedly, Uber Technologies 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 Uber Technologies will offset losses from the drop in Uber Technologies' long position.| FTAI Aviation vs. Empresa Distribuidora y | FTAI Aviation vs. United Utilities Group | FTAI Aviation vs. Treasury Wine Estates | FTAI Aviation vs. China Tontine Wines |
| Uber Technologies vs. Zoom Video Communications | Uber Technologies vs. Snowflake | Uber Technologies vs. Workday | Uber Technologies vs. C3 Ai Inc |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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