Correlation Between AA Mission and Expedia
Can any of the company-specific risk be diversified away by investing in both AA Mission and Expedia 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 AA Mission and Expedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AA Mission Acquisition and Expedia Group, you can compare the effects of market volatilities on AA Mission and Expedia 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 AA Mission with a short position of Expedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of AA Mission and Expedia.
Diversification Opportunities for AA Mission and Expedia
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AAM and Expedia is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding AA Mission Acquisition and Expedia Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expedia Group and AA Mission 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 AA Mission Acquisition are associated (or correlated) with Expedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expedia Group has no effect on the direction of AA Mission i.e., AA Mission and Expedia go up and down completely randomly.
Pair Corralation between AA Mission and Expedia
Considering the 90-day investment horizon AA Mission is expected to generate 12.53 times less return on investment than Expedia. But when comparing it to its historical volatility, AA Mission Acquisition is 14.62 times less risky than Expedia. It trades about 0.17 of its potential returns per unit of risk. Expedia Group is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 16,086 in Expedia Group on April 26, 2025 and sell it today you would earn a total of 2,962 from holding Expedia Group or generate 18.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AA Mission Acquisition vs. Expedia Group
Performance |
| Timeline |
| AA Mission Acquisition |
| Expedia Group |
AA Mission and Expedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AA Mission and Expedia
The main advantage of trading using opposite AA Mission and Expedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AA Mission position performs unexpectedly, Expedia 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 Expedia will offset losses from the drop in Expedia's long position.| AA Mission vs. Ultra Clean Holdings | AA Mission vs. Delek Energy | AA Mission vs. Capital Clean Energy | AA Mission vs. CVW CleanTech |
| Expedia vs. Booking Holdings | Expedia vs. TripAdvisor | Expedia vs. Airbnb Inc | Expedia vs. Royal Caribbean Cruises |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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