Correlation Between Aegean Airlines and Scandic Hotels

Can any of the company-specific risk be diversified away by investing in both Aegean Airlines and Scandic Hotels 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 Aegean Airlines and Scandic Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aegean Airlines SA and Scandic Hotels Group, you can compare the effects of market volatilities on Aegean Airlines and Scandic Hotels 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 Aegean Airlines with a short position of Scandic Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Scandic Hotels.

Diversification Opportunities for Aegean Airlines and Scandic Hotels

0.55

Correlation Coefficient

Aegean Airlines  Scandic Hotels

Very weak diversification

The 3 months correlation between Aegean and Scandic is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA and Scandic Hotels Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandic Hotels Group and Aegean Airlines 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 Aegean Airlines SA are associated (or correlated) with Scandic Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandic Hotels Group has no effect on the direction of Aegean Airlines i.e., Aegean Airlines and Scandic Hotels go up and down completely randomly.

Pair Corralation between Aegean Airlines and Scandic Hotels

Assuming the 90 days horizon Aegean Airlines is expected to generate 4.01 times less return on investment than Scandic Hotels. But when comparing it to its historical volatility, Aegean Airlines SA is 1.91 times less risky than Scandic Hotels. It trades about 0.01 of its potential returns per unit of risk. Scandic Hotels Group is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  697.00  in Scandic Hotels Group on March 23, 2025 and sell it today you would earn a total of  5.00  from holding Scandic Hotels Group or generate 0.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Aegean Airlines SA  vs.  Scandic Hotels Group

Aegean Airlines SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aegean Airlines SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Aegean Airlines is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Scandic Hotels Group

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Scandic Hotels Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Scandic Hotels is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Aegean Airlines and Scandic Hotels

The main advantage of trading using opposite Aegean Airlines and Scandic Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines position performs unexpectedly, Scandic Hotels 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 Scandic Hotels will offset losses from the drop in Scandic Hotels' long position.

The idea behind Aegean Airlines SA and Scandic Hotels Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.