Correlation Between First Quantum and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both First Quantum 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 First Quantum and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Quantum Minerals and Aegean Airlines SA, you can compare the effects of market volatilities on First Quantum 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 First Quantum with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Quantum and Aegean Airlines.
Diversification Opportunities for First Quantum and Aegean Airlines
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between First and Aegean is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding First Quantum Minerals and Aegean Airlines SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegean Airlines SA and First Quantum 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 First Quantum Minerals 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 SA has no effect on the direction of First Quantum i.e., First Quantum and Aegean Airlines go up and down completely randomly.
Pair Corralation between First Quantum and Aegean Airlines
Assuming the 90 days horizon First Quantum Minerals is expected to under-perform the Aegean Airlines. In addition to that, First Quantum is 1.36 times more volatile than Aegean Airlines SA. It trades about 0.0 of its total potential returns per unit of risk. Aegean Airlines SA is currently generating about 0.16 per unit of volatility. If you would invest 1,003 in Aegean Airlines SA on November 4, 2024 and sell it today you would earn a total of 67.00 from holding Aegean Airlines SA or generate 6.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Quantum Minerals vs. Aegean Airlines SA
Performance |
| Timeline |
| First Quantum Minerals |
| Aegean Airlines SA |
First Quantum and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Quantum and Aegean Airlines
The main advantage of trading using opposite First Quantum and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Quantum 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' long position.| First Quantum vs. Highlight Communications AG | First Quantum vs. China National Building | First Quantum vs. China Communications Services | First Quantum vs. Ribbon Communications |
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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