Correlation Between Century Therapeutics and AerSale Corp
Can any of the company-specific risk be diversified away by investing in both Century Therapeutics and AerSale Corp 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 Century Therapeutics and AerSale Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Century Therapeutics and AerSale Corp, you can compare the effects of market volatilities on Century Therapeutics and AerSale Corp 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 Century Therapeutics with a short position of AerSale Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Therapeutics and AerSale Corp.
Diversification Opportunities for Century Therapeutics and AerSale Corp
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Century and AerSale is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Century Therapeutics and AerSale Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AerSale Corp and Century Therapeutics 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 Century Therapeutics are associated (or correlated) with AerSale Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AerSale Corp has no effect on the direction of Century Therapeutics i.e., Century Therapeutics and AerSale Corp go up and down completely randomly.
Pair Corralation between Century Therapeutics and AerSale Corp
Given the investment horizon of 90 days Century Therapeutics is expected to under-perform the AerSale Corp. In addition to that, Century Therapeutics is 2.44 times more volatile than AerSale Corp. It trades about -0.25 of its total potential returns per unit of risk. AerSale Corp is currently generating about 0.29 per unit of volatility. If you would invest 630.00 in AerSale Corp on November 1, 2024 and sell it today you would earn a total of 50.00 from holding AerSale Corp or generate 7.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Century Therapeutics vs. AerSale Corp
Performance |
| Timeline |
| Century Therapeutics |
| AerSale Corp |
Century Therapeutics and AerSale Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Century Therapeutics and AerSale Corp
The main advantage of trading using opposite Century Therapeutics and AerSale Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Century Therapeutics position performs unexpectedly, AerSale Corp 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 AerSale Corp will offset losses from the drop in AerSale Corp's long position.| Century Therapeutics vs. Edgewise Therapeutics | Century Therapeutics vs. C4 Therapeutics | Century Therapeutics vs. Mineralys Therapeutics, Common | Century Therapeutics vs. Cullinan Oncology LLC |
| AerSale Corp vs. Grupo Aeroportuario del | AerSale Corp vs. Grupo Aeroportuario del | AerSale Corp vs. Corporacion America Airports | AerSale Corp vs. Aeroports de Paris |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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