Correlation Between Air Transport and Carnegie Clean
Can any of the company-specific risk be diversified away by investing in both Air Transport and Carnegie Clean 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 Carnegie Clean 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 Carnegie Clean Energy, you can compare the effects of market volatilities on Air Transport and Carnegie Clean 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 Carnegie Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Transport and Carnegie Clean.
Diversification Opportunities for Air Transport and Carnegie Clean
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Air and Carnegie is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Air Transport Services and Carnegie Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carnegie Clean Energy 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 Carnegie Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carnegie Clean Energy has no effect on the direction of Air Transport i.e., Air Transport and Carnegie Clean go up and down completely randomly.
Pair Corralation between Air Transport and Carnegie Clean
Assuming the 90 days horizon Air Transport Services is expected to generate 0.13 times more return on investment than Carnegie Clean. However, Air Transport Services is 7.96 times less risky than Carnegie Clean. It trades about 0.09 of its potential returns per unit of risk. Carnegie Clean Energy is currently generating about -0.02 per unit of risk. If you would invest 2,080 in Air Transport Services on December 5, 2024 and sell it today you would earn a total of 60.00 from holding Air Transport Services or generate 2.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Air Transport Services vs. Carnegie Clean Energy
Performance |
Timeline |
Air Transport Services |
Carnegie Clean Energy |
Air Transport and Carnegie Clean Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Air Transport and Carnegie Clean
The main advantage of trading using opposite Air Transport and Carnegie Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Transport position performs unexpectedly, Carnegie Clean 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 Carnegie Clean will offset losses from the drop in Carnegie Clean's long position.Air Transport vs. Gaztransport et technigaz | Air Transport vs. CARSALESCOM | Air Transport vs. Fukuyama Transporting Co | Air Transport vs. SPORT LISBOA E |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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