Correlation Between Gol Linhas and Air Transport
Can any of the company-specific risk be diversified away by investing in both Gol Linhas and Air Transport 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 Gol Linhas and Air Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gol Linhas Aereas and Air Transport Services, you can compare the effects of market volatilities on Gol Linhas and Air Transport 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 Gol Linhas with a short position of Air Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gol Linhas and Air Transport.
Diversification Opportunities for Gol Linhas and Air Transport
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gol and Air is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Gol Linhas Aereas and Air Transport Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Transport Services and Gol Linhas 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 Gol Linhas Aereas are associated (or correlated) with Air Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Transport Services has no effect on the direction of Gol Linhas i.e., Gol Linhas and Air Transport go up and down completely randomly.
Pair Corralation between Gol Linhas and Air Transport
If you would invest 1,720 in Air Transport Services on August 27, 2024 and sell it today you would earn a total of 476.00 from holding Air Transport Services or generate 27.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Gol Linhas Aereas vs. Air Transport Services
Performance |
| Timeline |
| Gol Linhas Aereas |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Air Transport Services |
Gol Linhas and Air Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gol Linhas and Air Transport
The main advantage of trading using opposite Gol Linhas and Air Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gol Linhas position performs unexpectedly, Air Transport 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 Transport will offset losses from the drop in Air Transport's long position.| Gol Linhas vs. Azul SA | Gol Linhas vs. Air France KLM | Gol Linhas vs. Copa Holdings SA | Gol Linhas vs. International Consolidated Airlines |
| Air Transport vs. Copa Holdings SA | Air Transport vs. SkyWest | Air Transport vs. Sun Country Airlines | Air Transport vs. Frontier Group Holdings |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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