Correlation Between Public Storage and Gol Intelligent
Can any of the company-specific risk be diversified away by investing in both Public Storage and Gol Intelligent 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 Public Storage and Gol Intelligent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Public Storage and Gol Intelligent Airlines, you can compare the effects of market volatilities on Public Storage and Gol Intelligent 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 Public Storage with a short position of Gol Intelligent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Public Storage and Gol Intelligent.
Diversification Opportunities for Public Storage and Gol Intelligent
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Public and Gol is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Public Storage and Gol Intelligent Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gol Intelligent Airlines and Public Storage 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 Public Storage are associated (or correlated) with Gol Intelligent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gol Intelligent Airlines has no effect on the direction of Public Storage i.e., Public Storage and Gol Intelligent go up and down completely randomly.
Pair Corralation between Public Storage and Gol Intelligent
Assuming the 90 days horizon Public Storage is expected to generate 0.2 times more return on investment than Gol Intelligent. However, Public Storage is 4.94 times less risky than Gol Intelligent. It trades about 0.04 of its potential returns per unit of risk. Gol Intelligent Airlines is currently generating about -0.01 per unit of risk. If you would invest 25,085 in Public Storage on August 27, 2024 and sell it today you would earn a total of 7,085 from holding Public Storage or generate 28.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Public Storage vs. Gol Intelligent Airlines
Performance |
| Timeline |
| Public Storage |
| Gol Intelligent Airlines |
Public Storage and Gol Intelligent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Public Storage and Gol Intelligent
The main advantage of trading using opposite Public Storage and Gol Intelligent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Public Storage position performs unexpectedly, Gol Intelligent 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 Gol Intelligent will offset losses from the drop in Gol Intelligent's long position.| Public Storage vs. XLMedia PLC | Public Storage vs. Cal Maine Foods | Public Storage vs. PARKEN Sport Entertainment | Public Storage vs. Flutter Entertainment PLC |
| Gol Intelligent vs. Jupiter Fund Management | Gol Intelligent vs. Public Storage | Gol Intelligent vs. AGF Management Limited | Gol Intelligent vs. Fidelity National Information |
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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