Correlation Between Lion One and American Airlines
Can any of the company-specific risk be diversified away by investing in both Lion One and American 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 Lion One and American Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lion One Metals and American Airlines Group, you can compare the effects of market volatilities on Lion One and American 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 Lion One with a short position of American Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion One and American Airlines.
Diversification Opportunities for Lion One and American Airlines
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lion and American is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Lion One Metals and American Airlines Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Airlines and Lion One 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 Lion One Metals are associated (or correlated) with American Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Airlines has no effect on the direction of Lion One i.e., Lion One and American Airlines go up and down completely randomly.
Pair Corralation between Lion One and American Airlines
Assuming the 90 days horizon Lion One Metals is expected to under-perform the American Airlines. In addition to that, Lion One is 1.26 times more volatile than American Airlines Group. It trades about -0.04 of its total potential returns per unit of risk. American Airlines Group is currently generating about 0.24 per unit of volatility. If you would invest 1,232 in American Airlines Group on September 1, 2024 and sell it today you would earn a total of 194.00 from holding American Airlines Group or generate 15.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lion One Metals vs. American Airlines Group
Performance |
| Timeline |
| Lion One Metals |
| American Airlines |
Lion One and American Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion One and American Airlines
The main advantage of trading using opposite Lion One and American Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion One position performs unexpectedly, American 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 American Airlines will offset losses from the drop in American Airlines' long position.| Lion One vs. NIPPON STEEL SPADR | Lion One vs. United States Steel | Lion One vs. Nippon Steel | Lion One vs. Singapore Telecommunications Limited |
| American Airlines vs. SERI INDUSTRIAL EO | American Airlines vs. GRIFFIN MINING LTD | American Airlines vs. Lion One Metals | American Airlines vs. Western Copper and |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |