Correlation Between Aegean Airlines and Ark Restaurants

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

Diversification Opportunities for Aegean Airlines and Ark Restaurants

0.18

Correlation Coefficient

Aegean Airlines  Ark Restaurants

Average diversification

The 3 months correlation between Aegean and Ark is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Ark Restaurants Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ark Restaurants Corp 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 Ark Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ark Restaurants Corp has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Ark Restaurants go up and down completely randomly.

Pair Corralation between Aegean Airlines and Ark Restaurants

Assuming the 90 days horizon Aegean Airlines SA is expected to under-perform the Ark Restaurants. But the pink sheet apears to be less risky and, when comparing its historical volatility, Aegean Airlines SA is 3.24 times less risky than Ark Restaurants. The pink sheet trades about -0.21 of its potential returns per unit of risk. The Ark Restaurants Corp is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  1,195  in Ark Restaurants Corp on September 23, 2024 and sell it today you would lose (66.00) from holding Ark Restaurants Corp or give up 5.52% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	97.73%
Values	Daily Returns

Aegean Airlines SA  vs.  Ark Restaurants Corp

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 weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Ark Restaurants Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ark Restaurants Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward-looking signals, Ark Restaurants is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Aegean Airlines and Ark Restaurants

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

The idea behind Aegean Airlines SA and Ark Restaurants Corp 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.