Correlation Between Sky Harbour and Austal
Can any of the company-specific risk be diversified away by investing in both Sky Harbour and Austal 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 Sky Harbour and Austal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sky Harbour Group and Austal Limited, you can compare the effects of market volatilities on Sky Harbour and Austal 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 Sky Harbour with a short position of Austal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sky Harbour and Austal.
Diversification Opportunities for Sky Harbour and Austal
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sky and Austal is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Sky Harbour Group and Austal Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austal Limited and Sky Harbour 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 Sky Harbour Group are associated (or correlated) with Austal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austal Limited has no effect on the direction of Sky Harbour i.e., Sky Harbour and Austal go up and down completely randomly.
Pair Corralation between Sky Harbour and Austal
Given the investment horizon of 90 days Sky Harbour is expected to generate 1.78 times less return on investment than Austal. But when comparing it to its historical volatility, Sky Harbour Group is 1.22 times less risky than Austal. It trades about 0.04 of its potential returns per unit of risk. Austal Limited is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 143.00 in Austal Limited on August 25, 2024 and sell it today you would earn a total of 57.00 from holding Austal Limited or generate 39.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sky Harbour Group vs. Austal Limited
Performance |
| Timeline |
| Sky Harbour Group |
| Austal Limited |
Sky Harbour and Austal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sky Harbour and Austal
The main advantage of trading using opposite Sky Harbour and Austal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sky Harbour position performs unexpectedly, Austal 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 Austal will offset losses from the drop in Austal's long position.| Sky Harbour vs. Ducommun Incorporated | Sky Harbour vs. Innovative Solutions and | Sky Harbour vs. National Presto Industries | Sky Harbour vs. Astronics |
| Austal vs. 808 Renewable Energy | Austal vs. Sky Harbour Group | Austal vs. VirTra Inc | Austal vs. Firan Technology Group |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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