Correlation Between 12572QAH8 and American Airlines
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By analyzing existing cross correlation between CME GROUP INC and American Airlines Group, you can compare the effects of market volatilities on 12572QAH8 and American Airlines 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 12572QAH8 with a short position of American Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of 12572QAH8 and American Airlines.
Diversification Opportunities for 12572QAH8 and American Airlines
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between 12572QAH8 and American is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding CME GROUP INC and American Airlines Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Airlines and 12572QAH8 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 CME GROUP INC are associated (or correlated) with American Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Airlines has no effect on the direction of 12572QAH8 i.e., 12572QAH8 and American Airlines go up and down completely randomly.
Pair Corralation between 12572QAH8 and American Airlines
Assuming the 90 days trading horizon CME GROUP INC is expected to generate 25.71 times more return on investment than American Airlines. However, 12572QAH8 is 25.71 times more volatile than American Airlines Group. It trades about 0.06 of its potential returns per unit of risk. American Airlines Group is currently generating about 0.02 per unit of risk. If you would invest 9,538 in CME GROUP INC on September 3, 2024 and sell it today you would lose (593.00) from holding CME GROUP INC or give up 6.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 52.32% |
| Values | Daily Returns |
CME GROUP INC vs. American Airlines Group
Performance |
| Timeline |
| CME GROUP INC |
| American Airlines |
12572QAH8 and American Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 12572QAH8 and American Airlines
The main advantage of trading using opposite 12572QAH8 and American Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 12572QAH8 position performs unexpectedly, American Airlines 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 American Airlines will offset losses from the drop in American Airlines' long position.| 12572QAH8 vs. American Airlines Group | 12572QAH8 vs. Aegean Airlines SA | 12572QAH8 vs. Ryanair Holdings PLC | 12572QAH8 vs. Constellation Brands Class |
| American Airlines vs. Delta Air Lines | American Airlines vs. Southwest Airlines | American Airlines vs. JetBlue Airways Corp | American Airlines vs. United Airlines Holdings |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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