Correlation Between Aegean Airlines and Aimfinity Investment

Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Aimfinity Investment 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 Aimfinity Investment 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 Aimfinity Investment I, you can compare the effects of market volatilities on Aegean Airlines and Aimfinity Investment 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 Aimfinity Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Aimfinity Investment.

Diversification Opportunities for Aegean Airlines and Aimfinity Investment

-0.57

Correlation Coefficient

Aegean Airlines  Aimfinity Investment

Excellent diversification

The 3 months correlation between Aegean and Aimfinity is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Aimfinity Investment I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aimfinity Investment 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 Aimfinity Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aimfinity Investment has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Aimfinity Investment go up and down completely randomly.

Pair Corralation between Aegean Airlines and Aimfinity Investment

Assuming the 90 days horizon Aegean Airlines SA is expected to under-perform the Aimfinity Investment. In addition to that, Aegean Airlines is 3.46 times more volatile than Aimfinity Investment I. It trades about -0.13 of its total potential returns per unit of risk. Aimfinity Investment I is currently generating about 0.12 per unit of volatility. If you would invest  1,166  in Aimfinity Investment I on September 13, 2024 and sell it today you would earn a total of  34.00  from holding Aimfinity Investment I or generate 2.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Aegean Airlines SA  vs.  Aimfinity Investment I

Aegean Airlines SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aegean Airlines SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Aimfinity Investment

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aimfinity Investment I are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Aimfinity Investment is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Aegean Airlines and Aimfinity Investment

The main advantage of trading using opposite Aegean Airlines and Aimfinity Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Aimfinity Investment 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 Aimfinity Investment will offset losses from the drop in Aimfinity Investment's long position.

The idea behind Aegean Airlines SA and Aimfinity Investment I 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.