Correlation Between Mitsubishi UFJ and Air Lease
Can any of the company-specific risk be diversified away by investing in both Mitsubishi UFJ and Air Lease 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 Mitsubishi UFJ and Air Lease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitsubishi UFJ Lease and Air Lease, you can compare the effects of market volatilities on Mitsubishi UFJ and Air Lease 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 Mitsubishi UFJ with a short position of Air Lease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitsubishi UFJ and Air Lease.
Diversification Opportunities for Mitsubishi UFJ and Air Lease
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mitsubishi and Air is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Mitsubishi UFJ Lease and Air Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Lease and Mitsubishi UFJ 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 Mitsubishi UFJ Lease are associated (or correlated) with Air Lease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Lease has no effect on the direction of Mitsubishi UFJ i.e., Mitsubishi UFJ and Air Lease go up and down completely randomly.
Pair Corralation between Mitsubishi UFJ and Air Lease
Assuming the 90 days horizon Mitsubishi UFJ Lease is expected to under-perform the Air Lease. In addition to that, Mitsubishi UFJ is 2.63 times more volatile than Air Lease. It trades about -0.14 of its total potential returns per unit of risk. Air Lease is currently generating about 0.38 per unit of volatility. If you would invest 4,497 in Air Lease on August 28, 2024 and sell it today you would earn a total of 719.00 from holding Air Lease or generate 15.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Mitsubishi UFJ Lease vs. Air Lease
Performance |
| Timeline |
| Mitsubishi UFJ Lease |
| Air Lease |
Mitsubishi UFJ and Air Lease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitsubishi UFJ and Air Lease
The main advantage of trading using opposite Mitsubishi UFJ and Air Lease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitsubishi UFJ position performs unexpectedly, Air Lease 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 Air Lease will offset losses from the drop in Air Lease's long position.| Mitsubishi UFJ vs. Summit Hotel Properties | Mitsubishi UFJ vs. Mills Music Trust | Mitsubishi UFJ vs. Getty Realty | Mitsubishi UFJ vs. Cardinal Health |
| Air Lease vs. PROG Holdings | Air Lease vs. McGrath RentCorp | Air Lease vs. Mega Matrix Corp | Air Lease vs. FTAI Aviation Ltd |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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