Correlation Between 983133AA7 and FTAI Aviation

Can any of the company-specific risk be diversified away by investing in both 983133AA7 and FTAI Aviation 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 983133AA7 and FTAI Aviation into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between WYNN RESORTS FIN and FTAI Aviation Ltd, you can compare the effects of market volatilities on 983133AA7 and FTAI Aviation 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 983133AA7 with a short position of FTAI Aviation. Check out your portfolio center. Please also check ongoing floating volatility patterns of 983133AA7 and FTAI Aviation.

Diversification Opportunities for 983133AA7 and FTAI Aviation

-0.26

Correlation Coefficient

983133AA7  FTAI Aviation

Very good diversification

The 3 months correlation between 983133AA7 and FTAI is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding WYNN RESORTS FIN and FTAI Aviation Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FTAI Aviation and 983133AA7 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 WYNN RESORTS FIN are associated (or correlated) with FTAI Aviation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FTAI Aviation has no effect on the direction of 983133AA7 i.e., 983133AA7 and FTAI Aviation go up and down completely randomly.

Pair Corralation between 983133AA7 and FTAI Aviation

Assuming the 90 days trading horizon WYNN RESORTS FIN is expected to under-perform the FTAI Aviation. But the bond apears to be less risky and, when comparing its historical volatility, WYNN RESORTS FIN is 1.83 times less risky than FTAI Aviation. The bond trades about -0.08 of its potential returns per unit of risk. The FTAI Aviation Ltd is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  2,591  in FTAI Aviation Ltd on December 24, 2024 and sell it today you would lose (3.00) from holding FTAI Aviation Ltd or give up 0.12% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	88.33%
Values	Daily Returns

WYNN RESORTS FIN  vs.  FTAI Aviation Ltd

WYNN RESORTS FIN

Risk-Adjusted Performance

Very Weak

Over the last 90 days WYNN RESORTS FIN has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 983133AA7 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

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 recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with 983133AA7 and FTAI Aviation

The main advantage of trading using opposite 983133AA7 and FTAI Aviation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 983133AA7 position performs unexpectedly, FTAI Aviation 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 FTAI Aviation will offset losses from the drop in FTAI Aviation's long position.

The idea behind WYNN RESORTS FIN and FTAI Aviation Ltd 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.