Correlation Between Air Transport and Impinj

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

By analyzing existing cross correlation between Air Transport Services and Impinj Inc, you can compare the effects of market volatilities on Air Transport and Impinj 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 Air Transport with a short position of Impinj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Transport and Impinj.

Diversification Opportunities for Air Transport and Impinj

0.43

Correlation Coefficient

Air Transport  Impinj

Very weak diversification

The 3 months correlation between Air and Impinj is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Air Transport Services and Impinj Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impinj Inc and Air Transport 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 Air Transport Services are associated (or correlated) with Impinj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impinj Inc has no effect on the direction of Air Transport i.e., Air Transport and Impinj go up and down completely randomly.

Pair Corralation between Air Transport and Impinj

Assuming the 90 days horizon Air Transport Services is expected to generate 0.13 times more return on investment than Impinj. However, Air Transport Services is 7.91 times less risky than Impinj. It trades about -0.08 of its potential returns per unit of risk. Impinj Inc is currently generating about -0.14 per unit of risk. If you would invest  2,100  in Air Transport Services on December 20, 2024 and sell it today you would lose (60.00) from holding Air Transport Services or give up 2.86% of portfolio value over 90 days.

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

Air Transport Services  vs.  Impinj Inc

Air Transport Services

Risk-Adjusted Performance

Very Weak

Over the last 90 days Air Transport Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Air Transport is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Impinj Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Impinj Inc 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.

Pair Trading with Air Transport and Impinj

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

The idea behind Air Transport Services and Impinj Inc 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.