Correlation Between GXO Logistics and PS International
Can any of the company-specific risk be diversified away by investing in both GXO Logistics and PS International 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 GXO Logistics and PS International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GXO Logistics and PS International Group, you can compare the effects of market volatilities on GXO Logistics and PS International 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 GXO Logistics with a short position of PS International. Check out your portfolio center. Please also check ongoing floating volatility patterns of GXO Logistics and PS International.
Diversification Opportunities for GXO Logistics and PS International
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GXO and PSIG is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding GXO Logistics and PS International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PS International and GXO Logistics 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 GXO Logistics are associated (or correlated) with PS International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PS International has no effect on the direction of GXO Logistics i.e., GXO Logistics and PS International go up and down completely randomly.
Pair Corralation between GXO Logistics and PS International
Considering the 90-day investment horizon GXO Logistics is expected to generate 0.13 times more return on investment than PS International. However, GXO Logistics is 7.69 times less risky than PS International. It trades about -0.03 of its potential returns per unit of risk. PS International Group is currently generating about -0.05 per unit of risk. If you would invest 6,606 in GXO Logistics on September 12, 2024 and sell it today you would lose (1,658) from holding GXO Logistics or give up 25.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 28.69% |
| Values | Daily Returns |
GXO Logistics vs. PS International Group
Performance |
| Timeline |
| GXO Logistics |
| PS International |
GXO Logistics and PS International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GXO Logistics and PS International
The main advantage of trading using opposite GXO Logistics and PS International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GXO Logistics position performs unexpectedly, PS International 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 PS International will offset losses from the drop in PS International's long position.| GXO Logistics vs. Forward Air | GXO Logistics vs. Landstar System | GXO Logistics vs. JB Hunt Transport | GXO Logistics vs. Expeditors International of |
| PS International vs. GXO Logistics | PS International vs. JB Hunt Transport | PS International vs. Expeditors International of | PS International vs. CH Robinson Worldwide |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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