Correlation Between Gol Linhas and Azul SA
Can any of the company-specific risk be diversified away by investing in both Gol Linhas and Azul SA 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 Azul SA 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 Azul SA, you can compare the effects of market volatilities on Gol Linhas and Azul SA 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 Azul SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gol Linhas and Azul SA.
Diversification Opportunities for Gol Linhas and Azul SA
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Gol and Azul is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Gol Linhas Aereas and Azul SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azul SA 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 Azul SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azul SA has no effect on the direction of Gol Linhas i.e., Gol Linhas and Azul SA go up and down completely randomly.
Pair Corralation between Gol Linhas and Azul SA
If you would invest 438.00 in Gol Linhas Aereas on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Gol Linhas Aereas or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Gol Linhas Aereas vs. Azul SA
Performance |
| Timeline |
| Gol Linhas Aereas |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Azul SA |
Gol Linhas and Azul SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gol Linhas and Azul SA
The main advantage of trading using opposite Gol Linhas and Azul SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gol Linhas position performs unexpectedly, Azul SA 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 Azul SA will offset losses from the drop in Azul SA'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 |
| Azul SA vs. JetBlue Airways Corp | Azul SA vs. Allegiant Travel | Azul SA vs. SkyWest | Azul SA vs. Air Transport Services |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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