Correlation Between Monument Circle and Air Lease
Can any of the company-specific risk be diversified away by investing in both Monument Circle 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 Monument Circle and Air Lease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monument Circle Acquisition and Air Lease, you can compare the effects of market volatilities on Monument Circle 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 Monument Circle with a short position of Air Lease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monument Circle and Air Lease.
Diversification Opportunities for Monument Circle and Air Lease
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Monument and Air is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Monument Circle Acquisition and Air Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Lease and Monument Circle 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 Monument Circle Acquisition 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 Monument Circle i.e., Monument Circle and Air Lease go up and down completely randomly.
Pair Corralation between Monument Circle and Air Lease
If you would invest 3,895 in Air Lease on September 4, 2024 and sell it today you would earn a total of 1,165 from holding Air Lease or generate 29.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.0% |
| Values | Daily Returns |
Monument Circle Acquisition vs. Air Lease
Performance |
| Timeline |
| Monument Circle Acqu |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Air Lease |
Monument Circle and Air Lease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monument Circle and Air Lease
The main advantage of trading using opposite Monument Circle and Air Lease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monument Circle 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.| Monument Circle vs. Sensient Technologies | Monument Circle vs. The Mosaic | Monument Circle vs. Luxfer Holdings PLC | Monument Circle vs. NL Industries |
| Air Lease vs. Alta Equipment Group | Air Lease vs. McGrath RentCorp | Air Lease vs. Herc Holdings | Air Lease vs. HE Equipment Services |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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