Correlation Between National Presto and Sky Harbour
Can any of the company-specific risk be diversified away by investing in both National Presto and Sky Harbour 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 National Presto and Sky Harbour into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Presto Industries and Sky Harbour Group, you can compare the effects of market volatilities on National Presto and Sky Harbour 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 National Presto with a short position of Sky Harbour. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Presto and Sky Harbour.
Diversification Opportunities for National Presto and Sky Harbour
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between National and Sky is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding National Presto Industries and Sky Harbour Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sky Harbour Group and National Presto 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 National Presto Industries are associated (or correlated) with Sky Harbour. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sky Harbour Group has no effect on the direction of National Presto i.e., National Presto and Sky Harbour go up and down completely randomly.
Pair Corralation between National Presto and Sky Harbour
Considering the 90-day investment horizon National Presto Industries is expected to generate 0.52 times more return on investment than Sky Harbour. However, National Presto Industries is 1.91 times less risky than Sky Harbour. It trades about 0.08 of its potential returns per unit of risk. Sky Harbour Group is currently generating about -0.08 per unit of risk. If you would invest 7,486 in National Presto Industries on August 25, 2024 and sell it today you would earn a total of 381.00 from holding National Presto Industries or generate 5.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Presto Industries vs. Sky Harbour Group
Performance |
| Timeline |
| National Presto Indu |
| Sky Harbour Group |
National Presto and Sky Harbour Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Presto and Sky Harbour
The main advantage of trading using opposite National Presto and Sky Harbour positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Presto position performs unexpectedly, Sky Harbour 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 Sky Harbour will offset losses from the drop in Sky Harbour's long position.| National Presto vs. Park Electrochemical | National Presto vs. Ducommun Incorporated | National Presto vs. Innovative Solutions and | National Presto vs. VSE Corporation |
| Sky Harbour vs. Ducommun Incorporated | Sky Harbour vs. Innovative Solutions and | Sky Harbour vs. National Presto Industries | Sky Harbour vs. Astronics |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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