Correlation Between Alaska Air and VIVENDI UNSPONARD

Can any of the company-specific risk be diversified away by investing in both Alaska Air and VIVENDI UNSPONARD 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 Alaska Air and VIVENDI UNSPONARD into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Alaska Air Group and VIVENDI UNSPONARD EO, you can compare the effects of market volatilities on Alaska Air and VIVENDI UNSPONARD 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 Alaska Air with a short position of VIVENDI UNSPONARD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alaska Air and VIVENDI UNSPONARD.

Diversification Opportunities for Alaska Air and VIVENDI UNSPONARD

0.76

Correlation Coefficient

Alaska Air  VIVENDI UNSPONARD

Poor diversification

The 3 months correlation between Alaska and VIVENDI is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Alaska Air Group and VIVENDI UNSPONARD EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIVENDI UNSPONARD and Alaska Air 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 Alaska Air Group are associated (or correlated) with VIVENDI UNSPONARD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIVENDI UNSPONARD has no effect on the direction of Alaska Air i.e., Alaska Air and VIVENDI UNSPONARD go up and down completely randomly.

Pair Corralation between Alaska Air and VIVENDI UNSPONARD

Assuming the 90 days trading horizon Alaska Air Group is expected to generate 0.3 times more return on investment than VIVENDI UNSPONARD. However, Alaska Air Group is 3.29 times less risky than VIVENDI UNSPONARD. It trades about -0.15 of its potential returns per unit of risk. VIVENDI UNSPONARD EO is currently generating about -0.07 per unit of risk. If you would invest  6,290  in Alaska Air Group on December 30, 2024 and sell it today you would lose (1,443) from holding Alaska Air Group or give up 22.94% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Alaska Air Group  vs.  VIVENDI UNSPONARD EO

Alaska Air Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alaska Air Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

VIVENDI UNSPONARD

Risk-Adjusted Performance

Very Weak

Over the last 90 days VIVENDI UNSPONARD EO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Alaska Air and VIVENDI UNSPONARD

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

The idea behind Alaska Air Group and VIVENDI UNSPONARD EO 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.