Correlation Between International Consolidated and Safety Shot
Can any of the company-specific risk be diversified away by investing in both International Consolidated and Safety Shot 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 Safety Shot 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 Safety Shot, you can compare the effects of market volatilities on International Consolidated and Safety Shot 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 Safety Shot. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Consolidated and Safety Shot.
Diversification Opportunities for International Consolidated and Safety Shot
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between International and Safety is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding International Consolidated Air and Safety Shot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safety Shot 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 Safety Shot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safety Shot has no effect on the direction of International Consolidated i.e., International Consolidated and Safety Shot go up and down completely randomly.
Pair Corralation between International Consolidated and Safety Shot
Assuming the 90 days horizon International Consolidated Airlines is expected to generate 0.33 times more return on investment than Safety Shot. However, International Consolidated Airlines is 3.02 times less risky than Safety Shot. It trades about 0.42 of its potential returns per unit of risk. Safety Shot is currently generating about -0.21 per unit of risk. If you would invest 566.00 in International Consolidated Airlines on November 6, 2024 and sell it today you would earn a total of 301.00 from holding International Consolidated Airlines or generate 53.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Consolidated Air vs. Safety Shot
Performance |
| Timeline |
| International Consolidated |
| Safety Shot |
International Consolidated and Safety Shot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Consolidated and Safety Shot
The main advantage of trading using opposite International Consolidated and Safety Shot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Consolidated position performs unexpectedly, Safety Shot 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 Safety Shot will offset losses from the drop in Safety Shot's long position.| International Consolidated vs. Air France KLM SA | International Consolidated vs. Air France KLM | International Consolidated vs. Finnair Oyj | International Consolidated vs. AirAsia Group Berhad |
| Safety Shot vs. BioNTech SE | Safety Shot vs. Coty Inc | Safety Shot vs. Verra Mobility Corp | Safety Shot vs. MYT Netherlands Parent |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |