Correlation Between Delta Air and Aeva Technologies,

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

By analyzing existing cross correlation between Delta Air Lines and Aeva Technologies, WT, you can compare the effects of market volatilities on Delta Air and Aeva Technologies, 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 Delta Air with a short position of Aeva Technologies,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Air and Aeva Technologies,.

Diversification Opportunities for Delta Air and Aeva Technologies,

0.83

Correlation Coefficient

Delta Air  Aeva Technologies,

Very poor diversification

The 3 months correlation between Delta and Aeva is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Delta Air Lines and Aeva Technologies, WT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeva Technologies, and Delta Air 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 Delta Air Lines are associated (or correlated) with Aeva Technologies,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeva Technologies, has no effect on the direction of Delta Air i.e., Delta Air and Aeva Technologies, go up and down completely randomly.

Pair Corralation between Delta Air and Aeva Technologies,

Considering the 90-day investment horizon Delta Air is expected to generate 3.35 times less return on investment than Aeva Technologies,. But when comparing it to its historical volatility, Delta Air Lines is 6.51 times less risky than Aeva Technologies,. It trades about 0.22 of its potential returns per unit of risk. Aeva Technologies, WT is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  4.00  in Aeva Technologies, WT on September 14, 2024 and sell it today you would earn a total of  2.05  from holding Aeva Technologies, WT or generate 51.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	93.75%
Values	Daily Returns

Delta Air Lines  vs.  Aeva Technologies, WT

Delta Air Lines

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Delta Air Lines are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Delta Air disclosed solid returns over the last few months and may actually be approaching a breakup point.

Aeva Technologies,

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aeva Technologies, WT are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Aeva Technologies, unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Delta Air and Aeva Technologies,

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

The idea behind Delta Air Lines and Aeva Technologies, WT 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.