Correlation Between United Airlines and Thermo Fisher
Can any of the company-specific risk be diversified away by investing in both United Airlines and Thermo Fisher 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 Thermo Fisher 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 Thermo Fisher Scientific, you can compare the effects of market volatilities on United Airlines and Thermo Fisher 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 Thermo Fisher. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Airlines and Thermo Fisher.
Diversification Opportunities for United Airlines and Thermo Fisher
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between United and Thermo is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding United Airlines Holdings and Thermo Fisher Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thermo Fisher Scientific 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 Thermo Fisher. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thermo Fisher Scientific has no effect on the direction of United Airlines i.e., United Airlines and Thermo Fisher go up and down completely randomly.
Pair Corralation between United Airlines and Thermo Fisher
Assuming the 90 days trading horizon United Airlines Holdings is expected to generate 1.64 times more return on investment than Thermo Fisher. However, United Airlines is 1.64 times more volatile than Thermo Fisher Scientific. It trades about 0.2 of its potential returns per unit of risk. Thermo Fisher Scientific is currently generating about 0.32 per unit of risk. If you would invest 9,166 in United Airlines Holdings on November 4, 2024 and sell it today you would earn a total of 1,140 from holding United Airlines Holdings or generate 12.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
United Airlines Holdings vs. Thermo Fisher Scientific
Performance |
| Timeline |
| United Airlines Holdings |
| Thermo Fisher Scientific |
United Airlines and Thermo Fisher Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Airlines and Thermo Fisher
The main advantage of trading using opposite United Airlines and Thermo Fisher positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Airlines position performs unexpectedly, Thermo Fisher 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 Thermo Fisher will offset losses from the drop in Thermo Fisher's long position.| United Airlines vs. TRAVEL LEISURE DL 01 | United Airlines vs. PLAY2CHILL SA ZY | United Airlines vs. MUTUIONLINE | United Airlines vs. PACIFIC ONLINE |
| Thermo Fisher vs. NEWELL RUBBERMAID | Thermo Fisher vs. CanSino Biologics | Thermo Fisher vs. Heidelberg Materials AG | Thermo Fisher vs. VULCAN MATERIALS |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |