Correlation Between Joby Aviation and Blade Air
Can any of the company-specific risk be diversified away by investing in both Joby Aviation and Blade Air 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 Joby Aviation and Blade Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Joby Aviation and Blade Air Mobility, you can compare the effects of market volatilities on Joby Aviation and Blade Air 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 Joby Aviation with a short position of Blade Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Joby Aviation and Blade Air.
Diversification Opportunities for Joby Aviation and Blade Air
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Joby and Blade is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Joby Aviation and Blade Air Mobility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blade Air Mobility and Joby Aviation 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 Joby Aviation are associated (or correlated) with Blade Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blade Air Mobility has no effect on the direction of Joby Aviation i.e., Joby Aviation and Blade Air go up and down completely randomly.
Pair Corralation between Joby Aviation and Blade Air
Given the investment horizon of 90 days Joby Aviation is expected to generate 1.63 times less return on investment than Blade Air. But when comparing it to its historical volatility, Joby Aviation is 2.37 times less risky than Blade Air. It trades about 0.26 of its potential returns per unit of risk. Blade Air Mobility is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Blade Air Mobility on August 27, 2024 and sell it today you would earn a total of 11.00 from holding Blade Air Mobility or generate 37.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Joby Aviation vs. Blade Air Mobility
Performance |
| Timeline |
| Joby Aviation |
| Blade Air Mobility |
Joby Aviation and Blade Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Joby Aviation and Blade Air
The main advantage of trading using opposite Joby Aviation and Blade Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Joby Aviation position performs unexpectedly, Blade Air 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 Blade Air will offset losses from the drop in Blade Air's long position.| Joby Aviation vs. Archer Aviation | Joby Aviation vs. Lilium NV | Joby Aviation vs. Blade Air Mobility | Joby Aviation vs. Rocket Lab USA |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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