Correlation Between Magellan Aerospace and Boeing
Can any of the company-specific risk be diversified away by investing in both Magellan Aerospace and Boeing 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 Magellan Aerospace and Boeing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magellan Aerospace and The Boeing, you can compare the effects of market volatilities on Magellan Aerospace and Boeing 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 Magellan Aerospace with a short position of Boeing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magellan Aerospace and Boeing.
Diversification Opportunities for Magellan Aerospace and Boeing
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Magellan and Boeing is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Magellan Aerospace and The Boeing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boeing and Magellan Aerospace 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 Magellan Aerospace are associated (or correlated) with Boeing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boeing has no effect on the direction of Magellan Aerospace i.e., Magellan Aerospace and Boeing go up and down completely randomly.
Pair Corralation between Magellan Aerospace and Boeing
Assuming the 90 days trading horizon Magellan Aerospace is expected to generate 1.08 times more return on investment than Boeing. However, Magellan Aerospace is 1.08 times more volatile than The Boeing. It trades about 0.11 of its potential returns per unit of risk. The Boeing is currently generating about -0.15 per unit of risk. If you would invest 1,545 in Magellan Aerospace on August 16, 2025 and sell it today you would earn a total of 185.00 from holding Magellan Aerospace or generate 11.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Magellan Aerospace vs. The Boeing
Performance |
| Timeline |
| Magellan Aerospace |
| Boeing |
Magellan Aerospace and Boeing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magellan Aerospace and Boeing
The main advantage of trading using opposite Magellan Aerospace and Boeing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magellan Aerospace position performs unexpectedly, Boeing 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 Boeing will offset losses from the drop in Boeing's long position.| Magellan Aerospace vs. Black Diamond Group | Magellan Aerospace vs. ADENTRA | Magellan Aerospace vs. Mullen Group | Magellan Aerospace vs. Cargojet |
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.
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