Pair Correlation Between Alcoa and American Airlines

This module allows you to analyze existing cross correlation between Alcoa Corporation and American Airlines Group Inc. You can compare the effects of market volatilities on Alcoa and American 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 Alcoa with a short position of American Airlines. See also your portfolio center. Please also check ongoing floating volatility patterns of Alcoa and American Airlines.
 Time Horizon     30 Days    Login   to change
Symbolsvs
 Alcoa Corp.  vs   American Airlines Group Inc
 Performance (%) 
      Timeline 

Pair Volatility

Allowing for the 30-days total investment horizon, Alcoa is expected to generate 1.54 times less return on investment than American Airlines. In addition to that, Alcoa is 1.44 times more volatile than American Airlines Group Inc. It trades about 0.15 of its total potential returns per unit of risk. American Airlines Group Inc is currently generating about 0.33 per unit of volatility. If you would invest  5,259  in American Airlines Group Inc on December 22, 2017 and sell it today you would earn a total of  547  from holding American Airlines Group Inc or generate 10.4% return on investment over 30 days.

Correlation Coefficient

Pair Corralation between Alcoa and American Airlines
0.53

Parameters

Time Period1 Month [change]
DirectionPositive 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Diversification

Very weak diversification

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

Comparative Volatility

 Predicted Return Density 
      Returns 

Alcoa

  
9 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Alcoa Corporation are ranked lower than 9 (%) of all global equities and portfolios over the last 30 days.

American Airlines Group

  
21 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in American Airlines Group Inc are ranked lower than 21 (%) of all global equities and portfolios over the last 30 days.