Correlation Between Vista Oil and Delta Air
Can any of the company-specific risk be diversified away by investing in both Vista Oil and Delta Air 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 Vista Oil and Delta Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vista Oil Gas and Delta Air Lines, you can compare the effects of market volatilities on Vista Oil and Delta Air 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 Vista Oil with a short position of Delta Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vista Oil and Delta Air.
Diversification Opportunities for Vista Oil and Delta Air
Poor diversification
The 3 months correlation between Vista and Delta is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Vista Oil Gas and Delta Air Lines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Air Lines and Vista Oil 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 Vista Oil Gas are associated (or correlated) with Delta Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Air Lines has no effect on the direction of Vista Oil i.e., Vista Oil and Delta Air go up and down completely randomly.
Pair Corralation between Vista Oil and Delta Air
Assuming the 90 days trading horizon Vista Oil is expected to generate 1.27 times less return on investment than Delta Air. In addition to that, Vista Oil is 1.58 times more volatile than Delta Air Lines. It trades about 0.07 of its total potential returns per unit of risk. Delta Air Lines is currently generating about 0.14 per unit of volatility. If you would invest 86,240 in Delta Air Lines on September 26, 2024 and sell it today you would earn a total of 40,326 from holding Delta Air Lines or generate 46.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vista Oil Gas vs. Delta Air Lines
Performance |
| Timeline |
| Vista Oil Gas |
| Delta Air Lines |
Vista Oil and Delta Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vista Oil and Delta Air
The main advantage of trading using opposite Vista Oil and Delta Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vista Oil position performs unexpectedly, Delta Air 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 Delta Air will offset losses from the drop in Delta Air's long position.| Vista Oil vs. Delta Air Lines | Vista Oil vs. United Airlines Holdings | Vista Oil vs. Verizon Communications | Vista Oil vs. The Bank of |
| Delta Air vs. Southwest Airlines | Delta Air vs. United Airlines Holdings | Delta Air vs. Controladora Vuela Compaa | Delta Air vs. Grupo Aeromxico SAB |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |