Correlation Between Nomura Holdings and Aegean Airlines
Can any of the company-specific risk be diversified away by investing in both Nomura Holdings and Aegean 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 Nomura Holdings and Aegean Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nomura Holdings and Aegean Airlines SA, you can compare the effects of market volatilities on Nomura Holdings and Aegean 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 Nomura Holdings with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nomura Holdings and Aegean Airlines.
Diversification Opportunities for Nomura Holdings and Aegean Airlines
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nomura and Aegean is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Nomura Holdings and Aegean Airlines SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegean Airlines SA and Nomura Holdings 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 Nomura Holdings are associated (or correlated) with Aegean Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegean Airlines SA has no effect on the direction of Nomura Holdings i.e., Nomura Holdings and Aegean Airlines go up and down completely randomly.
Pair Corralation between Nomura Holdings and Aegean Airlines
Assuming the 90 days horizon Nomura Holdings is expected to generate 1.35 times less return on investment than Aegean Airlines. But when comparing it to its historical volatility, Nomura Holdings is 1.22 times less risky than Aegean Airlines. It trades about 0.06 of its potential returns per unit of risk. Aegean Airlines SA is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 493.00 in Aegean Airlines SA on September 12, 2024 and sell it today you would earn a total of 497.00 from holding Aegean Airlines SA or generate 100.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nomura Holdings vs. Aegean Airlines SA
Performance |
| Timeline |
| Nomura Holdings |
| Aegean Airlines SA |
Nomura Holdings and Aegean Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nomura Holdings and Aegean Airlines
The main advantage of trading using opposite Nomura Holdings and Aegean Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nomura Holdings position performs unexpectedly, Aegean 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 Aegean Airlines will offset losses from the drop in Aegean Airlines' long position.| Nomura Holdings vs. Superior Plus Corp | Nomura Holdings vs. SIVERS SEMICONDUCTORS AB | Nomura Holdings vs. CHINA HUARONG ENERHD 50 | Nomura Holdings vs. NORDIC HALIBUT AS |
| Aegean Airlines vs. RYANAIR HLDGS ADR | Aegean Airlines vs. Ryanair Holdings plc | Aegean Airlines vs. Superior Plus Corp | Aegean Airlines vs. SIVERS SEMICONDUCTORS AB |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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