Correlation Between International Consolidated and STM Group
Can any of the company-specific risk be diversified away by investing in both International Consolidated and STM Group 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 International Consolidated and STM Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Consolidated Airlines and STM Group Plc, you can compare the effects of market volatilities on International Consolidated and STM Group 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 International Consolidated with a short position of STM Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Consolidated and STM Group.
Diversification Opportunities for International Consolidated and STM Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between International and STM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding International Consolidated Air and STM Group Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STM Group Plc and International Consolidated 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 International Consolidated Airlines are associated (or correlated) with STM Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STM Group Plc has no effect on the direction of International Consolidated i.e., International Consolidated and STM Group go up and down completely randomly.
Pair Corralation between International Consolidated and STM Group
If you would invest 18,044 in International Consolidated Airlines on August 29, 2024 and sell it today you would earn a total of 7,246 from holding International Consolidated Airlines or generate 40.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
International Consolidated Air vs. STM Group Plc
Performance |
| Timeline |
| International Consolidated |
| STM Group Plc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
International Consolidated and STM Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Consolidated and STM Group
The main advantage of trading using opposite International Consolidated and STM Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Consolidated position performs unexpectedly, STM Group 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 STM Group will offset losses from the drop in STM Group's long position.| International Consolidated vs. Lendinvest PLC | International Consolidated vs. Neometals | International Consolidated vs. Coor Service Management | International Consolidated vs. Albion Technology General |
| STM Group vs. Spotify Technology SA | STM Group vs. Check Point Software | STM Group vs. Capital Drilling | STM Group vs. Batm Advanced Communications |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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