Correlation Between Grupo Aeroportuario and AerCap Holdings
Can any of the company-specific risk be diversified away by investing in both Grupo Aeroportuario and AerCap Holdings 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 Grupo Aeroportuario and AerCap Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Aeroportuario del and AerCap Holdings NV, you can compare the effects of market volatilities on Grupo Aeroportuario and AerCap Holdings 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 Grupo Aeroportuario with a short position of AerCap Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Aeroportuario and AerCap Holdings.
Diversification Opportunities for Grupo Aeroportuario and AerCap Holdings
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Grupo and AerCap is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Aeroportuario del and AerCap Holdings NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AerCap Holdings NV and Grupo Aeroportuario 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 Grupo Aeroportuario del are associated (or correlated) with AerCap Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AerCap Holdings NV has no effect on the direction of Grupo Aeroportuario i.e., Grupo Aeroportuario and AerCap Holdings go up and down completely randomly.
Pair Corralation between Grupo Aeroportuario and AerCap Holdings
Considering the 90-day investment horizon Grupo Aeroportuario del is expected to generate 1.77 times more return on investment than AerCap Holdings. However, Grupo Aeroportuario is 1.77 times more volatile than AerCap Holdings NV. It trades about 0.23 of its potential returns per unit of risk. AerCap Holdings NV is currently generating about -0.11 per unit of risk. If you would invest 31,700 in Grupo Aeroportuario del on January 27, 2024 and sell it today you would earn a total of 3,071 from holding Grupo Aeroportuario del or generate 9.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Aeroportuario del vs. AerCap Holdings NV
Performance |
| Timeline |
| Grupo Aeroportuario del |
| AerCap Holdings NV |
Grupo Aeroportuario and AerCap Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Aeroportuario and AerCap Holdings
The main advantage of trading using opposite Grupo Aeroportuario and AerCap Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Aeroportuario position performs unexpectedly, AerCap Holdings 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 AerCap Holdings will offset losses from the drop in AerCap Holdings' long position.| Grupo Aeroportuario vs. AerSale Corp | Grupo Aeroportuario vs. Flughafen Zrich AG | Grupo Aeroportuario vs. Aeroports de Paris | Grupo Aeroportuario vs. Airports of Thailand |
| AerCap Holdings vs. Ryder System | AerCap Holdings vs. Avis Budget Group | AerCap Holdings vs. FlexShopper | AerCap Holdings vs. Global Ship Lease |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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