Correlation Between United Airlines and Alstria Office
Can any of the company-specific risk be diversified away by investing in both United Airlines and Alstria Office 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 United Airlines and Alstria Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Airlines Holdings and alstria office REIT AG, you can compare the effects of market volatilities on United Airlines and Alstria Office 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 Alstria Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Airlines and Alstria Office.
Diversification Opportunities for United Airlines and Alstria Office
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between United and Alstria is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding United Airlines Holdings and alstria office REIT AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on alstria office REIT 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 Alstria Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of alstria office REIT has no effect on the direction of United Airlines i.e., United Airlines and Alstria Office go up and down completely randomly.
Pair Corralation between United Airlines and Alstria Office
Assuming the 90 days trading horizon United Airlines Holdings is expected to generate 0.85 times more return on investment than Alstria Office. However, United Airlines Holdings is 1.18 times less risky than Alstria Office. It trades about 0.08 of its potential returns per unit of risk. alstria office REIT AG is currently generating about 0.02 per unit of risk. If you would invest 4,653 in United Airlines Holdings on October 16, 2024 and sell it today you would earn a total of 6,023 from holding United Airlines Holdings or generate 129.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Airlines Holdings vs. alstria office REIT AG
Performance |
| Timeline |
| United Airlines Holdings |
| alstria office REIT |
United Airlines and Alstria Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Airlines and Alstria Office
The main advantage of trading using opposite United Airlines and Alstria Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Airlines position performs unexpectedly, Alstria Office 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 Alstria Office will offset losses from the drop in Alstria Office's long position.| United Airlines vs. SPARTAN STORES | United Airlines vs. Caseys General Stores | United Airlines vs. PRECISION DRILLING P | United Airlines vs. NorAm Drilling AS |
| Alstria Office vs. Commonwealth Bank of | Alstria Office vs. CITIC Telecom International | Alstria Office vs. PNC Financial Services | Alstria Office vs. Erste Group Bank |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Stocks Directory Find actively traded stocks across global markets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |