Correlation Between Delta Air and SYSTEMAIR
Can any of the company-specific risk be diversified away by investing in both Delta Air and SYSTEMAIR 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 Delta Air and SYSTEMAIR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delta Air Lines and SYSTEMAIR AB, you can compare the effects of market volatilities on Delta Air and SYSTEMAIR 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 Delta Air with a short position of SYSTEMAIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Air and SYSTEMAIR.
Diversification Opportunities for Delta Air and SYSTEMAIR
Very weak diversification
The 3 months correlation between Delta and SYSTEMAIR is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Delta Air Lines and SYSTEMAIR AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SYSTEMAIR AB and Delta Air 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 Delta Air Lines are associated (or correlated) with SYSTEMAIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SYSTEMAIR AB has no effect on the direction of Delta Air i.e., Delta Air and SYSTEMAIR go up and down completely randomly.
Pair Corralation between Delta Air and SYSTEMAIR
Assuming the 90 days horizon Delta Air Lines is expected to generate 2.56 times more return on investment than SYSTEMAIR. However, Delta Air is 2.56 times more volatile than SYSTEMAIR AB. It trades about 0.22 of its potential returns per unit of risk. SYSTEMAIR AB is currently generating about -0.57 per unit of risk. If you would invest 5,781 in Delta Air Lines on October 19, 2024 and sell it today you would earn a total of 608.00 from holding Delta Air Lines or generate 10.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
Delta Air Lines vs. SYSTEMAIR AB
Performance |
| Timeline |
| Delta Air Lines |
| SYSTEMAIR AB |
Delta Air and SYSTEMAIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delta Air and SYSTEMAIR
The main advantage of trading using opposite Delta Air and SYSTEMAIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delta Air position performs unexpectedly, SYSTEMAIR 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 SYSTEMAIR will offset losses from the drop in SYSTEMAIR's long position.| Delta Air vs. Synchrony Financial | Delta Air vs. SUN LIFE FINANCIAL | Delta Air vs. FUYO GENERAL LEASE | Delta Air vs. Webster Financial |
| SYSTEMAIR vs. MOVIE GAMES SA | SYSTEMAIR vs. TROPHY GAMES DEV | SYSTEMAIR vs. FRACTAL GAMING GROUP | SYSTEMAIR vs. CONTAGIOUS GAMING INC |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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