Correlation Between FTAI Aviation and Aarons

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

By analyzing existing cross correlation between FTAI Aviation Ltd and The Aarons, you can compare the effects of market volatilities on FTAI Aviation and Aarons 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 FTAI Aviation with a short position of Aarons. Check out your portfolio center. Please also check ongoing floating volatility patterns of FTAI Aviation and Aarons.

Diversification Opportunities for FTAI Aviation and Aarons

0.0

Correlation Coefficient

FTAI Aviation  Aarons

Pay attention - limited upside

The 3 months correlation between FTAI and Aarons is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FTAI Aviation Ltd and The Aarons in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aarons and FTAI Aviation 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 FTAI Aviation Ltd are associated (or correlated) with Aarons. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aarons has no effect on the direction of FTAI Aviation i.e., FTAI Aviation and Aarons go up and down completely randomly.

Pair Corralation between FTAI Aviation and Aarons

If you would invest (100.00) in The Aarons on December 28, 2024 and sell it today you would earn a total of  100.00  from holding The Aarons or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

FTAI Aviation Ltd  vs.  The Aarons

FTAI Aviation

Risk-Adjusted Performance

Very Weak

Over the last 90 days FTAI Aviation Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, FTAI Aviation is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Aarons

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Aarons has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Aarons is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with FTAI Aviation and Aarons

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

The idea behind FTAI Aviation Ltd and The Aarons 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.