Correlation Between Yuexiu Transport and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both Yuexiu Transport 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 Yuexiu Transport and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yuexiu Transport Infrastructure and AEGEAN AIRLINES, you can compare the effects of market volatilities on Yuexiu Transport 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 Yuexiu Transport with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuexiu Transport and AEGEAN AIRLINES.
Diversification Opportunities for Yuexiu Transport and AEGEAN AIRLINES
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Yuexiu and AEGEAN is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and Yuexiu Transport 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 Yuexiu Transport Infrastructure 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 has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between Yuexiu Transport and AEGEAN AIRLINES
Assuming the 90 days horizon Yuexiu Transport is expected to generate 1.5 times less return on investment than AEGEAN AIRLINES. But when comparing it to its historical volatility, Yuexiu Transport Infrastructure is 1.59 times less risky than AEGEAN AIRLINES. It trades about 0.32 of its potential returns per unit of risk. AEGEAN AIRLINES is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 940.00 in AEGEAN AIRLINES on September 24, 2024 and sell it today you would earn a total of 66.00 from holding AEGEAN AIRLINES or generate 7.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuexiu Transport Infrastructur vs. AEGEAN AIRLINES
Performance |
| Timeline |
| Yuexiu Transport Inf |
| AEGEAN AIRLINES |
Yuexiu Transport and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuexiu Transport and AEGEAN AIRLINES
The main advantage of trading using opposite Yuexiu Transport and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuexiu Transport 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's long position.| Yuexiu Transport vs. Transurban Group | Yuexiu Transport vs. Jiangsu Expressway | Yuexiu Transport vs. Zhejiang Expressway Co | Yuexiu Transport vs. Arcosa Inc |
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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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