Correlation Between Gilat Satellite and American Aires
Can any of the company-specific risk be diversified away by investing in both Gilat Satellite and American Aires 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 Gilat Satellite and American Aires into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gilat Satellite Networks and American Aires, you can compare the effects of market volatilities on Gilat Satellite and American Aires 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 Gilat Satellite with a short position of American Aires. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gilat Satellite and American Aires.
Diversification Opportunities for Gilat Satellite and American Aires
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gilat and American is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Gilat Satellite Networks and American Aires in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Aires and Gilat Satellite 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 Gilat Satellite Networks are associated (or correlated) with American Aires. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Aires has no effect on the direction of Gilat Satellite i.e., Gilat Satellite and American Aires go up and down completely randomly.
Pair Corralation between Gilat Satellite and American Aires
Given the investment horizon of 90 days Gilat Satellite Networks is expected to generate 0.34 times more return on investment than American Aires. However, Gilat Satellite Networks is 2.94 times less risky than American Aires. It trades about 0.14 of its potential returns per unit of risk. American Aires is currently generating about 0.04 per unit of risk. If you would invest 670.00 in Gilat Satellite Networks on November 5, 2024 and sell it today you would earn a total of 45.00 from holding Gilat Satellite Networks or generate 6.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Gilat Satellite Networks vs. American Aires
Performance |
| Timeline |
| Gilat Satellite Networks |
| American Aires |
Gilat Satellite and American Aires Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gilat Satellite and American Aires
The main advantage of trading using opposite Gilat Satellite and American Aires positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gilat Satellite position performs unexpectedly, American Aires 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 American Aires will offset losses from the drop in American Aires' long position.| Gilat Satellite vs. ADTRAN Inc | Gilat Satellite vs. Mynaric AG ADR | Gilat Satellite vs. KVH Industries | Gilat Satellite vs. Telesat Corp |
| American Aires vs. alpha En | American Aires vs. Alps Electric Co | American Aires vs. Bitmine Immersion Technologies | American Aires vs. AT S Austria |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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