Correlation Between Meta Platforms and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both Meta Platforms 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 Meta Platforms and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meta Platforms and Aegean Airlines SA, you can compare the effects of market volatilities on Meta Platforms 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 Meta Platforms with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meta Platforms and Aegean Airlines.
Diversification Opportunities for Meta Platforms and Aegean Airlines
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Meta and Aegean is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Meta Platforms 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 Meta Platforms 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 Meta Platforms 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 Meta Platforms i.e., Meta Platforms and Aegean Airlines go up and down completely randomly.
Pair Corralation between Meta Platforms and Aegean Airlines
Given the investment horizon of 90 days Meta Platforms is expected to generate 1.04 times more return on investment than Aegean Airlines. However, Meta Platforms is 1.04 times more volatile than Aegean Airlines SA. It trades about 0.14 of its potential returns per unit of risk. Aegean Airlines SA is currently generating about 0.07 per unit of risk. If you would invest 11,498 in Meta Platforms on August 29, 2024 and sell it today you would earn a total of 45,422 from holding Meta Platforms or generate 395.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meta Platforms vs. Aegean Airlines SA
Performance |
| Timeline |
| Meta Platforms |
| Aegean Airlines SA |
Meta Platforms and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meta Platforms and Aegean Airlines
The main advantage of trading using opposite Meta Platforms and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meta Platforms 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.| Meta Platforms vs. Alphabet Inc Class A | Meta Platforms vs. Twilio Inc | Meta Platforms vs. Snap Inc | Meta Platforms vs. Baidu Inc |
| Aegean Airlines vs. Apple Inc | Aegean Airlines vs. Microsoft | Aegean Airlines vs. Alphabet Inc Class C | Aegean Airlines vs. Meta Platforms |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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