Correlation Between Southwest Airlines and Grupo Profuturo
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By analyzing existing cross correlation between Southwest Airlines and Grupo Profuturo SAB, you can compare the effects of market volatilities on Southwest Airlines and Grupo Profuturo 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 Southwest Airlines with a short position of Grupo Profuturo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southwest Airlines and Grupo Profuturo.
Diversification Opportunities for Southwest Airlines and Grupo Profuturo
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Southwest and Grupo is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Southwest Airlines and Grupo Profuturo SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Profuturo SAB and Southwest Airlines 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 Southwest Airlines are associated (or correlated) with Grupo Profuturo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Profuturo SAB has no effect on the direction of Southwest Airlines i.e., Southwest Airlines and Grupo Profuturo go up and down completely randomly.
Pair Corralation between Southwest Airlines and Grupo Profuturo
Assuming the 90 days trading horizon Southwest Airlines is expected to under-perform the Grupo Profuturo. In addition to that, Southwest Airlines is 2.05 times more volatile than Grupo Profuturo SAB. It trades about -0.07 of its total potential returns per unit of risk. Grupo Profuturo SAB is currently generating about 0.3 per unit of volatility. If you would invest 10,500 in Grupo Profuturo SAB on November 4, 2024 and sell it today you would earn a total of 500.00 from holding Grupo Profuturo SAB or generate 4.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Southwest Airlines vs. Grupo Profuturo SAB
Performance |
| Timeline |
| Southwest Airlines |
| Grupo Profuturo SAB |
Southwest Airlines and Grupo Profuturo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southwest Airlines and Grupo Profuturo
The main advantage of trading using opposite Southwest Airlines and Grupo Profuturo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southwest Airlines position performs unexpectedly, Grupo Profuturo 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 Grupo Profuturo will offset losses from the drop in Grupo Profuturo's long position.| Southwest Airlines vs. UnitedHealth Group Incorporated | Southwest Airlines vs. First Majestic Silver | Southwest Airlines vs. Deutsche Bank Aktiengesellschaft | Southwest Airlines vs. Capital One Financial |
| Grupo Profuturo vs. First Republic Bank | Grupo Profuturo vs. Ameriprise Financial | Grupo Profuturo vs. Grupo Sports World | Grupo Profuturo vs. Monster Beverage Corp |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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