Correlation Between Neometals and United Airlines
Can any of the company-specific risk be diversified away by investing in both Neometals 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 Neometals and United Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neometals and United Airlines Holdings, you can compare the effects of market volatilities on Neometals 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 Neometals with a short position of United Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neometals and United Airlines.
Diversification Opportunities for Neometals and United Airlines
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Neometals and United is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Neometals 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 Neometals 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 Neometals 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 Neometals i.e., Neometals and United Airlines go up and down completely randomly.
Pair Corralation between Neometals and United Airlines
Assuming the 90 days trading horizon Neometals is expected to under-perform the United Airlines. In addition to that, Neometals is 3.03 times more volatile than United Airlines Holdings. It trades about -0.11 of its total potential returns per unit of risk. United Airlines Holdings is currently generating about -0.12 per unit of volatility. If you would invest 10,647 in United Airlines Holdings on November 27, 2024 and sell it today you would lose (798.00) from holding United Airlines Holdings or give up 7.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 28.57% |
| Values | Daily Returns |
Neometals vs. United Airlines Holdings
Performance |
| Timeline |
| Neometals |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| United Airlines Holdings |
Neometals and United Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neometals and United Airlines
The main advantage of trading using opposite Neometals and United Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neometals 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.| Neometals vs. Eastinco Mining Exploration | Neometals vs. Griffin Mining | Neometals vs. Endeavour Mining Corp | Neometals vs. Gamma Communications PLC |
| United Airlines vs. Gaztransport et Technigaz | United Airlines vs. Norman Broadbent Plc | United Airlines vs. Jacquet Metal Service | United Airlines vs. Power Metal Resources |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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