Correlation Between ALEFARM BREWING and Air Lease

Can any of the company-specific risk be diversified away by investing in both ALEFARM BREWING and Air Lease 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 ALEFARM BREWING and Air Lease into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ALEFARM BREWING DK 05 and Air Lease, you can compare the effects of market volatilities on ALEFARM BREWING and Air Lease 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 ALEFARM BREWING with a short position of Air Lease. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALEFARM BREWING and Air Lease.

Diversification Opportunities for ALEFARM BREWING and Air Lease

-0.35

Correlation Coefficient

ALEFARM BREWING  Air Lease

Very good diversification

The 3 months correlation between ALEFARM and Air is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding ALEFARM BREWING DK 05 and Air Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Lease and ALEFARM BREWING 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 ALEFARM BREWING DK 05 are associated (or correlated) with Air Lease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Lease has no effect on the direction of ALEFARM BREWING i.e., ALEFARM BREWING and Air Lease go up and down completely randomly.

Pair Corralation between ALEFARM BREWING and Air Lease

Assuming the 90 days horizon ALEFARM BREWING DK 05 is expected to under-perform the Air Lease. In addition to that, ALEFARM BREWING is 2.58 times more volatile than Air Lease. It trades about -0.01 of its total potential returns per unit of risk. Air Lease is currently generating about 0.19 per unit of volatility. If you would invest  3,965  in Air Lease on April 24, 2025 and sell it today you would earn a total of  875.00  from holding Air Lease or generate 22.07% return on investment over 90 days.

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

ALEFARM BREWING DK 05  vs.  Air Lease

ALEFARM BREWING DK

Risk-Adjusted Performance

Very Weak

Over the last 90 days ALEFARM BREWING DK 05 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ALEFARM BREWING is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Air Lease

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Air Lease are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, Air Lease reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ALEFARM BREWING and Air Lease

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

The idea behind ALEFARM BREWING DK 05 and Air Lease 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.