Correlation Between United Airlines and CARPENTER
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By analyzing existing cross correlation between United Airlines Holdings and CARPENTER TECHNOLOGY P, you can compare the effects of market volatilities on United Airlines and CARPENTER 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 United Airlines with a short position of CARPENTER. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Airlines and CARPENTER.
Diversification Opportunities for United Airlines and CARPENTER
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between United and CARPENTER is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding United Airlines Holdings and CARPENTER TECHNOLOGY P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CARPENTER TECHNOLOGY and United Airlines 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 United Airlines Holdings are associated (or correlated) with CARPENTER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CARPENTER TECHNOLOGY has no effect on the direction of United Airlines i.e., United Airlines and CARPENTER go up and down completely randomly.
Pair Corralation between United Airlines and CARPENTER
Considering the 90-day investment horizon United Airlines Holdings is expected to generate 4.57 times more return on investment than CARPENTER. However, United Airlines is 4.57 times more volatile than CARPENTER TECHNOLOGY P. It trades about 0.07 of its potential returns per unit of risk. CARPENTER TECHNOLOGY P is currently generating about 0.01 per unit of risk. If you would invest 4,982 in United Airlines Holdings on October 1, 2024 and sell it today you would earn a total of 4,983 from holding United Airlines Holdings or generate 100.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
United Airlines Holdings vs. CARPENTER TECHNOLOGY P
Performance |
| Timeline |
| United Airlines Holdings |
| CARPENTER TECHNOLOGY |
United Airlines and CARPENTER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Airlines and CARPENTER
The main advantage of trading using opposite United Airlines and CARPENTER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Airlines position performs unexpectedly, CARPENTER 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 CARPENTER will offset losses from the drop in CARPENTER's long position.| United Airlines vs. American Airlines Group | United Airlines vs. Southwest Airlines | United Airlines vs. JetBlue Airways Corp | United Airlines vs. Delta Air Lines |
| CARPENTER vs. AEP TEX INC | CARPENTER vs. US BANK NATIONAL | CARPENTER vs. Brightsphere Investment Group | CARPENTER vs. Neurocrine Biosciences |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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