Correlation Between National Vision and AerSale

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

By analyzing existing cross correlation between National Vision Holdings and AerSale, you can compare the effects of market volatilities on National Vision and AerSale 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 National Vision with a short position of AerSale. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Vision and AerSale.

Diversification Opportunities for National Vision and AerSale

0.0

Correlation Coefficient

National Vision  AerSale

Pay attention - limited upside

The 3 months correlation between National and AerSale is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Vision Holdings and AerSale in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AerSale and National Vision 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 National Vision Holdings are associated (or correlated) with AerSale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AerSale has no effect on the direction of National Vision i.e., National Vision and AerSale go up and down completely randomly.

Pair Corralation between National Vision and AerSale

If you would invest  0.00  in AerSale on February 3, 2024 and sell it today you would earn a total of  0.00  from holding AerSale or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.2%
Values	Daily Returns

National Vision Holdings  vs.  AerSale

National Vision Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days National Vision Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

AerSale

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AerSale has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, AerSale is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with National Vision and AerSale

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

The idea behind National Vision Holdings and AerSale 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.

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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.