Correlation Between Delta Air and Orix Corp

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

By analyzing existing cross correlation between Delta Air Lines and Orix Corp Ads, you can compare the effects of market volatilities on Delta Air and Orix Corp 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 Delta Air with a short position of Orix Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Air and Orix Corp.

Diversification Opportunities for Delta Air and Orix Corp

0.7

Correlation Coefficient

Delta Air  Orix Corp

Poor diversification

The 3 months correlation between Delta and Orix is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Delta Air Lines and Orix Corp Ads in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orix Corp Ads and Delta Air 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 Delta Air Lines are associated (or correlated) with Orix Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orix Corp Ads has no effect on the direction of Delta Air i.e., Delta Air and Orix Corp go up and down completely randomly.

Pair Corralation between Delta Air and Orix Corp

Assuming the 90 days horizon Delta Air is expected to generate 9.73 times less return on investment than Orix Corp. But when comparing it to its historical volatility, Delta Air Lines is 6.82 times less risky than Orix Corp. It trades about 0.03 of its potential returns per unit of risk. Orix Corp Ads is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,593  in Orix Corp Ads on April 22, 2025 and sell it today you would earn a total of  287.00  from holding Orix Corp Ads or generate 18.02% return on investment over 90 days.

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

Delta Air Lines  vs.  Orix Corp Ads

Delta Air Lines

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Delta Air Lines are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Delta Air reported solid returns over the last few months and may actually be approaching a breakup point.

Orix Corp Ads

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Orix Corp Ads are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Orix Corp may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Delta Air and Orix Corp

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

The idea behind Delta Air Lines and Orix Corp Ads 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.