Correlation Between Aegean Airlines and Autohellas

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

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

Diversification Opportunities for Aegean Airlines and Autohellas

0.62

Correlation Coefficient

Aegean Airlines  Autohellas

Poor diversification

The 3 months correlation between Aegean and Autohellas is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Autohellas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autohellas SA and Aegean 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 Aegean Airlines SA are associated (or correlated) with Autohellas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autohellas SA has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Autohellas go up and down completely randomly.

Pair Corralation between Aegean Airlines and Autohellas

Assuming the 90 days trading horizon Aegean Airlines SA is expected to generate 1.38 times more return on investment than Autohellas. However, Aegean Airlines is 1.38 times more volatile than Autohellas SA. It trades about 0.03 of its potential returns per unit of risk. Autohellas SA is currently generating about -0.04 per unit of risk. If you would invest  850.00  in Aegean Airlines SA on September 14, 2024 and sell it today you would earn a total of  160.00  from holding Aegean Airlines SA or generate 18.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Aegean Airlines SA  vs.  Autohellas SA

Aegean Airlines SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aegean Airlines SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Aegean Airlines is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Autohellas SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Autohellas SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Aegean Airlines and Autohellas

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

The idea behind Aegean Airlines SA and Autohellas SA 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 Stocks Directory module to find actively traded stocks across global markets.