LATAM Airlines Group Volatility
| LTMAYDelisted Stock | 0.39 0.01 2.50% |
We have found twenty-three technical indicators for LATAM Airlines, which you can use to evaluate the volatility of the entity. Please verify LATAM Airlines' mean deviation of 2.22, and Standard Deviation of 3.24 to check out if the risk estimate we provide is consistent with the expected return of 0.0%. Key indicators related to LATAM Airlines' volatility include:
30 Days Market Risk | Chance Of Distress | 30 Days Economic Sensitivity |
LATAM Airlines Pink Sheet volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of LATAM daily returns, and it is calculated using variance and standard deviation. We also use LATAM's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of LATAM Airlines volatility.
LATAM |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as LATAM Airlines can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of LATAM Airlines at lower prices. For example, an investor can purchase LATAM stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of LATAM Airlines' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving against LATAM Pink Sheet
| 0.58 | BAMXF | Bayerische Motoren Werke | PairCorr |
| 0.58 | LPTH | LightPath Technologies Earnings Call This Week | PairCorr |
| 0.54 | CHEAF | China Eastern Airlines | PairCorr |
| 0.39 | GILT | Gilat Satellite Networks | PairCorr |
| 0.33 | CHKP | Check Point Software Earnings Call This Week | PairCorr |
LATAM Airlines Market Sensitivity And Downside Risk
LATAM Airlines' beta coefficient measures the volatility of LATAM pink sheet compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents LATAM pink sheet's returns against your selected market. In other words, LATAM Airlines's beta of -0.69 provides an investor with an approximation of how much risk LATAM Airlines pink sheet can potentially add to one of your existing portfolios. LATAM Airlines Group exhibits very low volatility with skewness of 0.33 and kurtosis of 1.87. LATAM Airlines Group is a potential penny stock. Although LATAM Airlines may be in fact a good instrument to invest, many penny pink sheets are speculative in nature and are subject to artificial price hype. Please make sure you totally understand the upside potential and downside risk of investing in LATAM Airlines Group. We encourage investors to look for signals such as email spams, message board hypes, claims of breakthroughs, volume upswings, sudden news releases, promotions that are not reported, or demotions released before SEC filings. Please also check biographies and work history of current and past company officers before investing in high volatility instruments, penny stocks, or equities with microcap classification. You can indeed make money on LATAM instrument if you perfectly time your entry and exit. However, remember that penny pink sheets that have been the subject of artificial hype usually unable to maintain their increased share price for more than just a few days. The price of a promoted high volatility instrument will almost always revert back. The only way to increase shareholder value is through legitimate performance backed up by solid fundamentals.
3 Months Beta |Analyze LATAM Airlines Group Demand TrendCheck current 90 days LATAM Airlines correlation with market (Dow Jones Industrial)LATAM Beta |
LATAM standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 0.0 |
It is essential to understand the difference between upside risk (as represented by LATAM Airlines's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of LATAM Airlines' daily returns or price. Since the actual investment returns on holding a position in latam pink sheet tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in LATAM Airlines.
LATAM Airlines Group Pink Sheet Volatility Analysis
Volatility refers to the frequency at which LATAM Airlines pink sheet price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with LATAM Airlines' price changes. Investors will then calculate the volatility of LATAM Airlines' pink sheet to predict their future moves. A pink sheet that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A pink sheet with relatively stable price changes has low volatility. A highly volatile pink sheet is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of LATAM Airlines' volatility:
Historical Volatility
This type of pink sheet volatility measures LATAM Airlines' fluctuations based on previous trends. It's commonly used to predict LATAM Airlines' future behavior based on its past. However, it cannot conclusively determine the future direction of the pink sheet.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for LATAM Airlines' current market price. This means that the pink sheet will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on LATAM Airlines' to be redeemed at a future date.Transformation |
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LATAM Airlines Projected Return Density Against Market
Assuming the 90 days horizon LATAM Airlines Group has a beta of -0.6888 . This indicates as returns on the benchmark increase, returns on holding LATAM Airlines are expected to decrease at a much lower rate. During a bear market, however, LATAM Airlines Group is likely to outperform the market.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to LATAM Airlines or Industrials sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that LATAM Airlines' price will be affected by overall pink sheet market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a LATAM pink sheet's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
LATAM Airlines Group has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the Dow Jones Industrial. Predicted Return Density |
| Returns |
What Drives a LATAM Airlines Price Volatility?
Several factors can influence a pink sheet's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.LATAM Airlines Pink Sheet Return Volatility
LATAM Airlines historical daily return volatility represents how much of LATAM Airlines pink sheet's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company shows 0.0% volatility of returns over 90 . By contrast, Dow Jones Industrial accepts 0.8524% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About LATAM Airlines Volatility
Volatility is a rate at which the price of LATAM Airlines or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of LATAM Airlines may increase or decrease. In other words, similar to LATAM's beta indicator, it measures the risk of LATAM Airlines and helps estimate the fluctuations that may happen in a short period of time. So if prices of LATAM Airlines fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.3 ways to utilize LATAM Airlines' volatility to invest better
Higher LATAM Airlines' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of LATAM Airlines Group stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. LATAM Airlines Group stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of LATAM Airlines Group investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in LATAM Airlines' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of LATAM Airlines' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
LATAM Airlines Investment Opportunity
Dow Jones Industrial has a standard deviation of returns of 0.85 and is 9.223372036854776E16 times more volatile than LATAM Airlines Group. 0 percent of all equities and portfolios are less risky than LATAM Airlines. You can use LATAM Airlines Group to protect your portfolios against small market fluctuations. The pink sheet experiences an unexpected downward movement. The market is reacting to new fundamentals. Check odds of LATAM Airlines to be traded at 0.3744 in 90 days.Good diversification
The correlation between LATAM Airlines Group and DJI is -0.19 (i.e., Good diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding LATAM Airlines Group and DJI in the same portfolio, assuming nothing else is changed.
LATAM Airlines Additional Risk Indicators
The analysis of LATAM Airlines' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in LATAM Airlines' investment and either accepting that risk or mitigating it. Along with some common measures of LATAM Airlines pink sheet's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | (0.09) | |||
| Market Risk Adjusted Performance | 0.5925 | |||
| Mean Deviation | 2.22 | |||
| Coefficient Of Variation | (827.90) | |||
| Standard Deviation | 3.24 | |||
| Variance | 10.49 | |||
| Information Ratio | (0.15) |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential pink sheets, we recommend comparing similar pink sheets with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
LATAM Airlines Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against LATAM Airlines as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. LATAM Airlines' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, LATAM Airlines' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to LATAM Airlines Group.
Check out Correlation Analysis to better understand how to build diversified portfolios. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in nation. You can also try the Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Consideration for investing in LATAM Pink Sheet
If you are still planning to invest in LATAM Airlines Group check if it may still be traded through OTC markets such as Pink Sheets or OTC Bulletin Board. You may also purchase it directly from the company, but this is not always possible and may require contacting the company directly. Please note that delisted stocks are often considered to be more risky investments, as they are no longer subject to the same regulatory and reporting requirements as listed stocks. Therefore, it is essential to carefully research the LATAM Airlines' history and understand the potential risks before investing.
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