Correlation Between Satellogic and Alabama Aircraft

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Can any of the company-specific risk be diversified away by investing in both Satellogic and Alabama Aircraft 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 Satellogic and Alabama Aircraft into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Satellogic V and Alabama Aircraft Industries, you can compare the effects of market volatilities on Satellogic and Alabama Aircraft 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 Satellogic with a short position of Alabama Aircraft. Check out your portfolio center. Please also check ongoing floating volatility patterns of Satellogic and Alabama Aircraft.

Diversification Opportunities for Satellogic and Alabama Aircraft

-0.12
  Correlation Coefficient

Good diversification

The 3 months correlation between Satellogic and Alabama is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Satellogic V and Alabama Aircraft Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alabama Aircraft Ind and Satellogic 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 Satellogic V are associated (or correlated) with Alabama Aircraft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alabama Aircraft Ind has no effect on the direction of Satellogic i.e., Satellogic and Alabama Aircraft go up and down completely randomly.

Pair Corralation between Satellogic and Alabama Aircraft

If you would invest  100.00  in Satellogic V on September 4, 2024 and sell it today you would earn a total of  96.00  from holding Satellogic V or generate 96.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy1.56%
ValuesDaily Returns

Satellogic V  vs.  Alabama Aircraft Industries

 Performance 
       Timeline  
Satellogic V 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Satellogic V are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Satellogic disclosed solid returns over the last few months and may actually be approaching a breakup point.
Alabama Aircraft Ind 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Alabama Aircraft Industries has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward indicators, Alabama Aircraft is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Satellogic and Alabama Aircraft Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Satellogic and Alabama Aircraft

The main advantage of trading using opposite Satellogic and Alabama Aircraft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Satellogic position performs unexpectedly, Alabama Aircraft 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 Alabama Aircraft will offset losses from the drop in Alabama Aircraft's long position.
The idea behind Satellogic V and Alabama Aircraft Industries 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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