Correlation Between H2O Retailing and AEGEAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both H2O Retailing 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 H2O Retailing and AEGEAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between H2O Retailing and AEGEAN AIRLINES, you can compare the effects of market volatilities on H2O Retailing 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 H2O Retailing with a short position of AEGEAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of H2O Retailing and AEGEAN AIRLINES.
Diversification Opportunities for H2O Retailing and AEGEAN AIRLINES
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between H2O and AEGEAN is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding H2O Retailing and AEGEAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEGEAN AIRLINES and H2O Retailing 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 H2O Retailing 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 H2O Retailing i.e., H2O Retailing and AEGEAN AIRLINES go up and down completely randomly.
Pair Corralation between H2O Retailing and AEGEAN AIRLINES
Assuming the 90 days horizon H2O Retailing is expected to generate 1.38 times more return on investment than AEGEAN AIRLINES. However, H2O Retailing is 1.38 times more volatile than AEGEAN AIRLINES. It trades about 0.06 of its potential returns per unit of risk. AEGEAN AIRLINES is currently generating about 0.06 per unit of risk. If you would invest 708.00 in H2O Retailing on December 13, 2024 and sell it today you would earn a total of 642.00 from holding H2O Retailing or generate 90.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
H2O Retailing vs. AEGEAN AIRLINES
Performance |
| Timeline |
| H2O Retailing |
| AEGEAN AIRLINES |
H2O Retailing and AEGEAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with H2O Retailing and AEGEAN AIRLINES
The main advantage of trading using opposite H2O Retailing and AEGEAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if H2O Retailing 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.| H2O Retailing vs. Aluminum of | ||
| H2O Retailing vs. DAIDO METAL TD | ||
| H2O Retailing vs. PARKEN Sport Entertainment | ||
| H2O Retailing vs. Goosehead Insurance |
| AEGEAN AIRLINES vs. Goodyear Tire Rubber | ||
| AEGEAN AIRLINES vs. H2O Retailing | ||
| AEGEAN AIRLINES vs. Costco Wholesale Corp | ||
| AEGEAN AIRLINES vs. The Yokohama Rubber |
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.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |