Correlation Between Delta Air and Aston Minerals

Can any of the company-specific risk be diversified away by investing in both Delta Air and Aston Minerals 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 Aston Minerals 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 Aston Minerals, you can compare the effects of market volatilities on Delta Air and Aston Minerals 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 Aston Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Air and Aston Minerals.

Diversification Opportunities for Delta Air and Aston Minerals

0.39

Correlation Coefficient

Delta Air  Aston Minerals

Weak diversification

The 3 months correlation between Delta and Aston is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Delta Air Lines and Aston Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aston Minerals 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 Aston Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aston Minerals has no effect on the direction of Delta Air i.e., Delta Air and Aston Minerals go up and down completely randomly.

Pair Corralation between Delta Air and Aston Minerals

If you would invest  0.75  in Aston Minerals on September 14, 2024 and sell it today you would earn a total of  0.00  from holding Aston Minerals or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Delta Air Lines  vs.  Aston Minerals

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.

Aston Minerals

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aston Minerals are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Aston Minerals reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Delta Air and Aston Minerals

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

The idea behind Delta Air Lines and Aston Minerals 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.