Correlation Between JetAI and Corporacion America

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

By analyzing existing cross correlation between JetAI Inc and Corporacion America Airports, you can compare the effects of market volatilities on JetAI and Corporacion America 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 JetAI with a short position of Corporacion America. Check out your portfolio center. Please also check ongoing floating volatility patterns of JetAI and Corporacion America.

Diversification Opportunities for JetAI and Corporacion America

-0.71

Correlation Coefficient

JetAI  Corporacion America

Pay attention - limited upside

The 3 months correlation between JetAI and Corporacion is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding JetAI Inc and Corporacion America Airports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporacion America and JetAI 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 JetAI Inc are associated (or correlated) with Corporacion America. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporacion America has no effect on the direction of JetAI i.e., JetAI and Corporacion America go up and down completely randomly.

Pair Corralation between JetAI and Corporacion America

Given the investment horizon of 90 days JetAI Inc is expected to under-perform the Corporacion America. In addition to that, JetAI is 5.31 times more volatile than Corporacion America Airports. It trades about -0.03 of its total potential returns per unit of risk. Corporacion America Airports is currently generating about 0.22 per unit of volatility. If you would invest  1,468  in Corporacion America Airports on March 1, 2024 and sell it today you would earn a total of  383.00  from holding Corporacion America Airports or generate 26.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

JetAI Inc  vs.  Corporacion America Airports

JetAI Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JetAI Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in June 2024. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Corporacion America

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Corporacion America Airports are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Corporacion America reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JetAI and Corporacion America

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

The idea behind JetAI Inc and Corporacion America Airports 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.

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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.