Correlation Between Perseus Mining and AerCap Holdings
Can any of the company-specific risk be diversified away by investing in both Perseus Mining and AerCap Holdings 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 Perseus Mining and AerCap Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perseus Mining Limited and AerCap Holdings NV, you can compare the effects of market volatilities on Perseus Mining and AerCap Holdings 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 Perseus Mining with a short position of AerCap Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perseus Mining and AerCap Holdings.
Diversification Opportunities for Perseus Mining and AerCap Holdings
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Perseus and AerCap is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Perseus Mining Limited and AerCap Holdings NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AerCap Holdings NV and Perseus Mining 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 Perseus Mining Limited are associated (or correlated) with AerCap Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AerCap Holdings NV has no effect on the direction of Perseus Mining i.e., Perseus Mining and AerCap Holdings go up and down completely randomly.
Pair Corralation between Perseus Mining and AerCap Holdings
Assuming the 90 days horizon Perseus Mining Limited is expected to under-perform the AerCap Holdings. In addition to that, Perseus Mining is 1.57 times more volatile than AerCap Holdings NV. It trades about -0.08 of its total potential returns per unit of risk. AerCap Holdings NV is currently generating about 0.26 per unit of volatility. If you would invest 8,652 in AerCap Holdings NV on September 4, 2024 and sell it today you would earn a total of 718.00 from holding AerCap Holdings NV or generate 8.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Perseus Mining Limited vs. AerCap Holdings NV
Performance |
| Timeline |
| Perseus Mining |
| AerCap Holdings NV |
Perseus Mining and AerCap Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perseus Mining and AerCap Holdings
The main advantage of trading using opposite Perseus Mining and AerCap Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perseus Mining position performs unexpectedly, AerCap Holdings 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 AerCap Holdings will offset losses from the drop in AerCap Holdings' long position.| Perseus Mining vs. ZIJIN MINH UNSPADR20 | Perseus Mining vs. Barrick Gold | Perseus Mining vs. Superior Plus Corp | Perseus Mining vs. NMI Holdings |
| AerCap Holdings vs. Airports of Thailand | AerCap Holdings vs. Airports of Thailand | AerCap Holdings vs. Aena SME SA | AerCap Holdings vs. AENA SME UNSPADR110 |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |