Correlation Between Dine Brands and Aegean Airlines

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

By analyzing existing cross correlation between Dine Brands Global and Aegean Airlines SA, you can compare the effects of market volatilities on Dine Brands and Aegean Airlines 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 Dine Brands with a short position of Aegean Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dine Brands and Aegean Airlines.

Diversification Opportunities for Dine Brands and Aegean Airlines

-0.35

Correlation Coefficient

Dine Brands  Aegean Airlines

Very good diversification

The 3 months correlation between Dine and Aegean is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Dine Brands Global and Aegean Airlines SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegean Airlines SA and Dine Brands 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 Dine Brands Global are associated (or correlated) with Aegean Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegean Airlines SA has no effect on the direction of Dine Brands i.e., Dine Brands and Aegean Airlines go up and down completely randomly.

Pair Corralation between Dine Brands and Aegean Airlines

Considering the 90-day investment horizon Dine Brands Global is expected to under-perform the Aegean Airlines. In addition to that, Dine Brands is 1.05 times more volatile than Aegean Airlines SA. It trades about -0.05 of its total potential returns per unit of risk. Aegean Airlines SA is currently generating about 0.07 per unit of volatility. If you would invest  512.00  in Aegean Airlines SA on September 28, 2024 and sell it today you would earn a total of  513.00  from holding Aegean Airlines SA or generate 100.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Dine Brands Global  vs.  Aegean Airlines SA

Dine Brands Global

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Dine Brands Global are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, Dine Brands is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Aegean Airlines SA

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Dine Brands and Aegean Airlines

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

The idea behind Dine Brands Global and Aegean Airlines 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.

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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.