Correlation Between AerSale Corp and Almacenes Xito

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both AerSale Corp and Almacenes Xito 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 AerSale Corp and Almacenes Xito into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AerSale Corp and Almacenes xito SA, you can compare the effects of market volatilities on AerSale Corp and Almacenes Xito 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 AerSale Corp with a short position of Almacenes Xito. Check out your portfolio center. Please also check ongoing floating volatility patterns of AerSale Corp and Almacenes Xito.

Diversification Opportunities for AerSale Corp and Almacenes Xito

-0.81
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between AerSale and Almacenes is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding AerSale Corp and Almacenes xito SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Almacenes xito SA and AerSale Corp 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 AerSale Corp are associated (or correlated) with Almacenes Xito. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Almacenes xito SA has no effect on the direction of AerSale Corp i.e., AerSale Corp and Almacenes Xito go up and down completely randomly.

Pair Corralation between AerSale Corp and Almacenes Xito

Given the investment horizon of 90 days AerSale Corp is expected to generate 0.33 times more return on investment than Almacenes Xito. However, AerSale Corp is 3.0 times less risky than Almacenes Xito. It trades about 0.05 of its potential returns per unit of risk. Almacenes xito SA is currently generating about -0.08 per unit of risk. If you would invest  604.00  in AerSale Corp on October 8, 2024 and sell it today you would earn a total of  8.00  from holding AerSale Corp or generate 1.32% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

AerSale Corp  vs.  Almacenes xito SA

 Performance 
       Timeline  
AerSale Corp 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in AerSale Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak essential indicators, AerSale Corp exhibited solid returns over the last few months and may actually be approaching a breakup point.
Almacenes xito SA 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Almacenes xito SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

AerSale Corp and Almacenes Xito Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with AerSale Corp and Almacenes Xito

The main advantage of trading using opposite AerSale Corp and Almacenes Xito positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AerSale Corp position performs unexpectedly, Almacenes Xito 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 Almacenes Xito will offset losses from the drop in Almacenes Xito's long position.
The idea behind AerSale Corp and Almacenes xito SA 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.
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.

Other Complementary Tools

Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios
Stocks Directory
Find actively traded stocks across global markets
Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Commodity Directory
Find actively traded commodities issued by global exchanges