Correlation Between Southwest Airlines and La Comer
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By analyzing existing cross correlation between Southwest Airlines and La Comer SAB, you can compare the effects of market volatilities on Southwest Airlines and La Comer 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 La Comer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southwest Airlines and La Comer.
Diversification Opportunities for Southwest Airlines and La Comer
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Southwest and LACOMERUBC is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Southwest Airlines and La Comer SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on La Comer 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 La Comer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of La Comer SAB has no effect on the direction of Southwest Airlines i.e., Southwest Airlines and La Comer go up and down completely randomly.
Pair Corralation between Southwest Airlines and La Comer
Assuming the 90 days trading horizon Southwest Airlines is expected to under-perform the La Comer. But the stock apears to be less risky and, when comparing its historical volatility, Southwest Airlines is 1.05 times less risky than La Comer. The stock trades about -0.07 of its potential returns per unit of risk. The La Comer SAB is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3,305 in La Comer SAB on November 2, 2024 and sell it today you would earn a total of 91.00 from holding La Comer SAB or generate 2.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Southwest Airlines vs. La Comer SAB
Performance |
| Timeline |
| Southwest Airlines |
| La Comer SAB |
Southwest Airlines and La Comer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southwest Airlines and La Comer
The main advantage of trading using opposite Southwest Airlines and La Comer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southwest Airlines position performs unexpectedly, La Comer 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 La Comer will offset losses from the drop in La Comer's long position.| Southwest Airlines vs. First Majestic Silver | Southwest Airlines vs. Deutsche Bank Aktiengesellschaft | Southwest Airlines vs. United Airlines Holdings | Southwest Airlines vs. Desarrolladora Homex SAB |
| La Comer vs. Grupo Comercial Chedraui | La Comer vs. Gentera SAB de | La Comer vs. El Puerto de | La Comer vs. Organizacin Soriana S |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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