Correlation Between Lumen Technologies and American Airlines
Can any of the company-specific risk be diversified away by investing in both Lumen Technologies and American Airlines 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 Lumen Technologies and American Airlines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumen Technologies and American Airlines Group, you can compare the effects of market volatilities on Lumen Technologies and American Airlines 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 Lumen Technologies with a short position of American Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumen Technologies and American Airlines.
Diversification Opportunities for Lumen Technologies and American Airlines
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lumen and American is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lumen Technologies and American Airlines Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Airlines and Lumen Technologies 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 Lumen Technologies are associated (or correlated) with American Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Airlines has no effect on the direction of Lumen Technologies i.e., Lumen Technologies and American Airlines go up and down completely randomly.
Pair Corralation between Lumen Technologies and American Airlines
If you would invest 1,315 in American Airlines Group on February 12, 2024 and sell it today you would earn a total of 125.00 from holding American Airlines Group or generate 9.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Lumen Technologies vs. American Airlines Group
Performance |
| Timeline |
| Lumen Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| American Airlines |
Lumen Technologies and American Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumen Technologies and American Airlines
The main advantage of trading using opposite Lumen Technologies and American Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumen Technologies position performs unexpectedly, American Airlines 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 American Airlines will offset losses from the drop in American Airlines' long position.| Lumen Technologies vs. AssetMark Financial Holdings | Lumen Technologies vs. Inflection Point Acquisition | Lumen Technologies vs. Emerson Electric | Lumen Technologies vs. Highway Holdings Limited |
| American Airlines vs. Delta Air Lines | American Airlines vs. Southwest Airlines | American Airlines vs. JetBlue Airways Corp | American Airlines vs. Spirit Airlines |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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