Correlation Between Aegean Airlines and COMPUTERSHARE

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Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and COMPUTERSHARE 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 Aegean Airlines and COMPUTERSHARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegean Airlines SA and COMPUTERSHARE, you can compare the effects of market volatilities on Aegean Airlines and COMPUTERSHARE 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 Aegean Airlines with a short position of COMPUTERSHARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and COMPUTERSHARE.

Diversification Opportunities for Aegean Airlines and COMPUTERSHARE

AegeanCOMPUTERSHAREDiversified AwayAegeanCOMPUTERSHAREDiversified Away100%
0.55
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Aegean and COMPUTERSHARE is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and COMPUTERSHARE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COMPUTERSHARE and Aegean 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 Aegean Airlines SA are associated (or correlated) with COMPUTERSHARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COMPUTERSHARE has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and COMPUTERSHARE go up and down completely randomly.

Pair Corralation between Aegean Airlines and COMPUTERSHARE

Assuming the 90 days horizon Aegean Airlines is expected to generate 2.65 times less return on investment than COMPUTERSHARE. But when comparing it to its historical volatility, Aegean Airlines SA is 1.26 times less risky than COMPUTERSHARE. It trades about 0.11 of its potential returns per unit of risk. COMPUTERSHARE is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  1,840  in COMPUTERSHARE on November 18, 2024 and sell it today you would earn a total of  720.00  from holding COMPUTERSHARE or generate 39.13% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Aegean Airlines SA  vs.  COMPUTERSHARE

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -505101520
JavaScript chart by amCharts 3.21.1532A QCH
       Timeline  
Aegean Airlines SA 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Aegean Airlines SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating basic indicators, Aegean Airlines reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb9.51010.5
COMPUTERSHARE 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in COMPUTERSHARE are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical indicators, COMPUTERSHARE exhibited solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb19202122232425

Aegean Airlines and COMPUTERSHARE Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-6.2-4.64-3.09-1.530.01.583.194.86.41 0.020.040.060.080.10
JavaScript chart by amCharts 3.21.1532A QCH
       Returns  

Pair Trading with Aegean Airlines and COMPUTERSHARE

The main advantage of trading using opposite Aegean Airlines and COMPUTERSHARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, COMPUTERSHARE 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 COMPUTERSHARE will offset losses from the drop in COMPUTERSHARE's long position.
The idea behind Aegean Airlines SA and COMPUTERSHARE pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.

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