Correlation Between Aegean Airlines and Parker Hannifin
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Parker Hannifin 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 Parker Hannifin 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 Parker Hannifin, you can compare the effects of market volatilities on Aegean Airlines and Parker Hannifin 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 Parker Hannifin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Parker Hannifin.
Diversification Opportunities for Aegean Airlines and Parker Hannifin
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aegean and Parker is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Parker Hannifin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parker Hannifin 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 Parker Hannifin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parker Hannifin has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Parker Hannifin go up and down completely randomly.
Pair Corralation between Aegean Airlines and Parker Hannifin
Assuming the 90 days horizon Aegean Airlines SA is expected to generate 1.15 times more return on investment than Parker Hannifin. However, Aegean Airlines is 1.15 times more volatile than Parker Hannifin. It trades about 0.13 of its potential returns per unit of risk. Parker Hannifin is currently generating about -0.01 per unit of risk. If you would invest 1,025 in Aegean Airlines SA on December 27, 2024 and sell it today you would earn a total of 170.00 from holding Aegean Airlines SA or generate 16.59% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 96.83% |
Values | Daily Returns |
Aegean Airlines SA vs. Parker Hannifin
Performance |
Timeline |
Aegean Airlines SA |
Parker Hannifin |
Aegean Airlines and Parker Hannifin Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aegean Airlines and Parker Hannifin
The main advantage of trading using opposite Aegean Airlines and Parker Hannifin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Parker Hannifin 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 Parker Hannifin will offset losses from the drop in Parker Hannifin's long position.Aegean Airlines vs. Copa Holdings SA | Aegean Airlines vs. United Airlines Holdings | Aegean Airlines vs. Delta Air Lines | Aegean Airlines vs. SkyWest |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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