Correlation Between Airbus Group and Viscofan

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

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

Diversification Opportunities for Airbus Group and Viscofan

-0.85

Correlation Coefficient

Airbus Group  Viscofan

Pay attention - limited upside

The 3 months correlation between Airbus and Viscofan is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Airbus Group SE and Viscofan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viscofan and Airbus Group 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 Airbus Group SE are associated (or correlated) with Viscofan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viscofan has no effect on the direction of Airbus Group i.e., Airbus Group and Viscofan go up and down completely randomly.

Pair Corralation between Airbus Group and Viscofan

Assuming the 90 days trading horizon Airbus Group SE is expected to generate 1.4 times more return on investment than Viscofan. However, Airbus Group is 1.4 times more volatile than Viscofan. It trades about 0.28 of its potential returns per unit of risk. Viscofan is currently generating about -0.13 per unit of risk. If you would invest  13,810  in Airbus Group SE on April 24, 2025 and sell it today you would earn a total of  4,318  from holding Airbus Group SE or generate 31.27% return on investment over 90 days.

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

Airbus Group SE  vs.  Viscofan

Airbus Group SE

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Airbus Group SE are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Airbus Group exhibited solid returns over the last few months and may actually be approaching a breakup point.

Viscofan

Risk-Adjusted Performance

Very Weak

Over the last 90 days Viscofan has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Airbus Group and Viscofan

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

The idea behind Airbus Group SE and Viscofan 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.