Correlation Between WestJet Airlines and Metro Pacific
Can any of the company-specific risk be diversified away by investing in both WestJet Airlines and Metro Pacific 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 WestJet Airlines and Metro Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WestJet Airlines and Metro Pacific Investments, you can compare the effects of market volatilities on WestJet Airlines and Metro Pacific 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 WestJet Airlines with a short position of Metro Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of WestJet Airlines and Metro Pacific.
Diversification Opportunities for WestJet Airlines and Metro Pacific
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between WestJet and Metro is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding WestJet Airlines and Metro Pacific Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Pacific Investments and WestJet Airlines 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 WestJet Airlines are associated (or correlated) with Metro Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Pacific Investments has no effect on the direction of WestJet Airlines i.e., WestJet Airlines and Metro Pacific go up and down completely randomly.
Pair Corralation between WestJet Airlines and Metro Pacific
If you would invest (100.00) in Metro Pacific Investments on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Metro Pacific Investments or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WestJet Airlines vs. Metro Pacific Investments
Performance |
| Timeline |
| WestJet Airlines |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Metro Pacific Investments |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
WestJet Airlines and Metro Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WestJet Airlines and Metro Pacific
The main advantage of trading using opposite WestJet Airlines and Metro Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WestJet Airlines position performs unexpectedly, Metro Pacific 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 Metro Pacific will offset losses from the drop in Metro Pacific's long position.| WestJet Airlines vs. Repligen | WestJet Airlines vs. Intchains Group Limited | WestJet Airlines vs. Micron Technology | WestJet Airlines vs. Skechers USA |
| Metro Pacific vs. Shake Shack | Metro Pacific vs. Wingstop | Metro Pacific vs. Texas Roadhouse | Metro Pacific vs. Nuvalent |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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