Correlation Between Northern Lion and United Airlines
Can any of the company-specific risk be diversified away by investing in both Northern Lion and United 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 Northern Lion and United Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Northern Lion Gold and United Airlines Holdings, you can compare the effects of market volatilities on Northern Lion and United 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 Northern Lion with a short position of United Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern Lion and United Airlines.
Diversification Opportunities for Northern Lion and United Airlines
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Northern and United is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Northern Lion Gold and United Airlines Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Airlines Holdings and Northern Lion 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 Northern Lion Gold are associated (or correlated) with United Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Airlines Holdings has no effect on the direction of Northern Lion i.e., Northern Lion and United Airlines go up and down completely randomly.
Pair Corralation between Northern Lion and United Airlines
If you would invest 9,948 in United Airlines Holdings on October 23, 2024 and sell it today you would earn a total of 1,104 from holding United Airlines Holdings or generate 11.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Northern Lion Gold vs. United Airlines Holdings
Performance |
| Timeline |
| Northern Lion Gold |
| United Airlines Holdings |
Northern Lion and United Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northern Lion and United Airlines
The main advantage of trading using opposite Northern Lion and United Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern Lion position performs unexpectedly, United 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 United Airlines will offset losses from the drop in United Airlines' long position.| Northern Lion vs. Piedmont Lithium Ltd | Northern Lion vs. Sigma Lithium Resources | Northern Lion vs. Standard Lithium | Northern Lion vs. MP Materials Corp |
| United Airlines vs. American Airlines Group | United Airlines vs. Southwest Airlines | United Airlines vs. JetBlue Airways Corp | United Airlines vs. Delta Air Lines |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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