This module allows you to analyze existing cross correlation between CVS Health Corporation and American Airlines Group. You can compare the effects of market volatilities on CVS Health 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 CVS Health with a short position of American Airlines. See also your portfolio center. Please also check ongoing floating volatility patterns of CVS Health and American Airlines.
Considering 30-days investment horizon, CVS Health Corporation is expected to under-perform the American Airlines. In addition to that, CVS Health is 1.18 times more volatile than American Airlines Group. It trades about -0.12 of its total potential returns per unit of risk. American Airlines Group is currently generating about 0.1 per unit of volatility. If you would invest 4,340 in American Airlines Group on April 27, 2018 and sell it today you would earn a total of 151.00 from holding American Airlines Group or generate 3.48% return on investment over 30 days.
Pair Corralation between CVS Health and American Airlines
Overlapping area represents the amount of risk that can be diversified away by holding CVS Health Corp. and American Airlines Group Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on American Airlines Group and CVS Health 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 CVS Health Corporation 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 Group has no effect on the direction of CVS Health i.e. CVS Health and American Airlines go up and down completely randomly.
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