Correlation Analysis Between American Airlines and Alcoa

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

American Airlines  
00

Risk-Adjusted Performance

Over the last 30 days American Airlines Group has generated negative risk-adjusted returns adding no value to investors with long positions. Even with considerably steady technical indicators, American Airlines is not utilizing all of its potentials. The current stock price chaos, may contribute to medium term losses for the stakeholders.
Alcoa  
11

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Alcoa Corporation are ranked lower than 1 (%) of all global equities and portfolios over the last 30 days. Despite somewhat strong basic indicators, Alcoa is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short term losses for the investors.

American Airlines and Alcoa Volatility Contrast

 Predicted Return Density 
      Returns 

American Airlines Group Inc  vs.  Alcoa Corp.

 Performance (%) 
      Timeline 

Pair Volatility

Considering 30-days investment horizon, American Airlines Group is expected to under-perform the Alcoa. But the stock apears to be less risky and, when comparing its historical volatility, American Airlines Group is 1.33 times less risky than Alcoa. The stock trades about -0.01 of its potential returns per unit of risk. The Alcoa Corporation is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  2,030  in Alcoa Corporation on November 6, 2019 and sell it today you would earn a total of  30.00  from holding Alcoa Corporation or generate 1.48% return on investment over 30 days.

Pair Corralation between American Airlines and Alcoa

0.71
Time Period3 Months [change]
DirectionPositive 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Diversification Opportunities for American Airlines and Alcoa

American Airlines Group Inc diversification synergy

Poor diversification

Overlapping area represents the amount of risk that can be diversified away by holding American Airlines Group Inc and Alcoa Corp. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Alcoa and American 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 American Airlines Group are associated (or correlated) with Alcoa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alcoa has no effect on the direction of American Airlines i.e. American Airlines and Alcoa go up and down completely randomly.
See also your portfolio center. Please also try Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.


 
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