Correlation Between Spirit Aerosystems and GMO Internet
Can any of the company-specific risk be diversified away by investing in both Spirit Aerosystems and GMO Internet 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 Spirit Aerosystems and GMO Internet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spirit Aerosystems Holdings and GMO Internet, you can compare the effects of market volatilities on Spirit Aerosystems and GMO Internet 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 Spirit Aerosystems with a short position of GMO Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spirit Aerosystems and GMO Internet.
Diversification Opportunities for Spirit Aerosystems and GMO Internet
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Spirit and GMO is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Spirit Aerosystems Holdings and GMO Internet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GMO Internet and Spirit Aerosystems 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 Spirit Aerosystems Holdings are associated (or correlated) with GMO Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GMO Internet has no effect on the direction of Spirit Aerosystems i.e., Spirit Aerosystems and GMO Internet go up and down completely randomly.
Pair Corralation between Spirit Aerosystems and GMO Internet
Considering the 90-day investment horizon Spirit Aerosystems Holdings is expected to generate 0.91 times more return on investment than GMO Internet. However, Spirit Aerosystems Holdings is 1.1 times less risky than GMO Internet. It trades about 0.27 of its potential returns per unit of risk. GMO Internet is currently generating about -0.02 per unit of risk. If you would invest 3,481 in Spirit Aerosystems Holdings on April 24, 2025 and sell it today you would earn a total of 667.00 from holding Spirit Aerosystems Holdings or generate 19.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spirit Aerosystems Holdings vs. GMO Internet
Performance |
| Timeline |
| Spirit Aerosystems |
| GMO Internet |
Spirit Aerosystems and GMO Internet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spirit Aerosystems and GMO Internet
The main advantage of trading using opposite Spirit Aerosystems and GMO Internet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spirit Aerosystems position performs unexpectedly, GMO Internet 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 GMO Internet will offset losses from the drop in GMO Internet's long position.| Spirit Aerosystems vs. Textron | Spirit Aerosystems vs. Triumph Group | Spirit Aerosystems vs. Embraer SA ADR | Spirit Aerosystems vs. The Boeing |
| GMO Internet vs. KORE Group Holdings | GMO Internet vs. PLDT Inc ADR | GMO Internet vs. Telefonica SA ADR | GMO Internet vs. SBI Holdings |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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