Correlation Between Big 5 and Gol Intelligent
Can any of the company-specific risk be diversified away by investing in both Big 5 and Gol Intelligent 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 Big 5 and Gol Intelligent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Big 5 Sporting and Gol Intelligent Airlines, you can compare the effects of market volatilities on Big 5 and Gol Intelligent 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 Big 5 with a short position of Gol Intelligent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Big 5 and Gol Intelligent.
Diversification Opportunities for Big 5 and Gol Intelligent
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Big and Gol is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Big 5 Sporting and Gol Intelligent Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gol Intelligent Airlines and Big 5 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 Big 5 Sporting are associated (or correlated) with Gol Intelligent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gol Intelligent Airlines has no effect on the direction of Big 5 i.e., Big 5 and Gol Intelligent go up and down completely randomly.
Pair Corralation between Big 5 and Gol Intelligent
If you would invest 165.00 in Big 5 Sporting on September 13, 2024 and sell it today you would lose (8.00) from holding Big 5 Sporting or give up 4.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Big 5 Sporting vs. Gol Intelligent Airlines
Performance |
| Timeline |
| Big 5 Sporting |
| Gol Intelligent Airlines |
Big 5 and Gol Intelligent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Big 5 and Gol Intelligent
The main advantage of trading using opposite Big 5 and Gol Intelligent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Big 5 position performs unexpectedly, Gol Intelligent 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 Intelligent will offset losses from the drop in Gol Intelligent's long position.| Big 5 vs. Superior Plus Corp | Big 5 vs. SIVERS SEMICONDUCTORS AB | Big 5 vs. NorAm Drilling AS | Big 5 vs. Norsk Hydro ASA |
| Gol Intelligent vs. Apple Inc | Gol Intelligent vs. Apple Inc | Gol Intelligent vs. Apple Inc | Gol Intelligent vs. Apple Inc |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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