Correlation Between South West and Gol Linhas
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By analyzing existing cross correlation between South West Pinnacle and Gol Linhas Aereas, you can compare the effects of market volatilities on South West and Gol Linhas 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 South West with a short position of Gol Linhas. Check out your portfolio center. Please also check ongoing floating volatility patterns of South West and Gol Linhas.
Diversification Opportunities for South West and Gol Linhas
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between South and Gol is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding South West Pinnacle and Gol Linhas Aereas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gol Linhas Aereas and South West 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 South West Pinnacle are associated (or correlated) with Gol Linhas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gol Linhas Aereas has no effect on the direction of South West i.e., South West and Gol Linhas go up and down completely randomly.
Pair Corralation between South West and Gol Linhas
Assuming the 90 days trading horizon South West Pinnacle is expected to generate 0.4 times more return on investment than Gol Linhas. However, South West Pinnacle is 2.52 times less risky than Gol Linhas. It trades about -0.11 of its potential returns per unit of risk. Gol Linhas Aereas is currently generating about -0.19 per unit of risk. If you would invest 18,458 in South West Pinnacle on February 6, 2024 and sell it today you would lose (6,743) from holding South West Pinnacle or give up 36.53% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 50.85% |
Values | Daily Returns |
South West Pinnacle vs. Gol Linhas Aereas
Performance |
Timeline |
South West Pinnacle |
Gol Linhas Aereas |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
South West and Gol Linhas Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with South West and Gol Linhas
The main advantage of trading using opposite South West and Gol Linhas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if South West position performs unexpectedly, Gol Linhas 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 Gol Linhas will offset losses from the drop in Gol Linhas' long position.South West vs. Reliance Industries Limited | South West vs. Punjab Sind Bank | South West vs. ICICI Bank Limited | South West vs. Oil Natural Gas |
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Check out your portfolio center.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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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