Correlation Between Southwest Airlines and ANTA SPORTS
Can any of the company-specific risk be diversified away by investing in both Southwest Airlines and ANTA SPORTS 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 Southwest Airlines and ANTA SPORTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Southwest Airlines Co and ANTA SPORTS PRODUCT, you can compare the effects of market volatilities on Southwest Airlines and ANTA SPORTS 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 ANTA SPORTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southwest Airlines and ANTA SPORTS.
Diversification Opportunities for Southwest Airlines and ANTA SPORTS
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Southwest and ANTA is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Southwest Airlines Co and ANTA SPORTS PRODUCT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA SPORTS PRODUCT 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 Co are associated (or correlated) with ANTA SPORTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA SPORTS PRODUCT has no effect on the direction of Southwest Airlines i.e., Southwest Airlines and ANTA SPORTS go up and down completely randomly.
Pair Corralation between Southwest Airlines and ANTA SPORTS
Assuming the 90 days horizon Southwest Airlines is expected to generate 3.66 times less return on investment than ANTA SPORTS. But when comparing it to its historical volatility, Southwest Airlines Co is 1.39 times less risky than ANTA SPORTS. It trades about 0.01 of its potential returns per unit of risk. ANTA SPORTS PRODUCT is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 859.00 in ANTA SPORTS PRODUCT on November 2, 2024 and sell it today you would earn a total of 161.00 from holding ANTA SPORTS PRODUCT or generate 18.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Southwest Airlines Co vs. ANTA SPORTS PRODUCT
Performance |
| Timeline |
| Southwest Airlines |
| ANTA SPORTS PRODUCT |
Southwest Airlines and ANTA SPORTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southwest Airlines and ANTA SPORTS
The main advantage of trading using opposite Southwest Airlines and ANTA SPORTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southwest Airlines position performs unexpectedly, ANTA SPORTS 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 ANTA SPORTS will offset losses from the drop in ANTA SPORTS's long position.| Southwest Airlines vs. MUTUIONLINE | Southwest Airlines vs. SALESFORCE INC CDR | Southwest Airlines vs. Dalata Hotel Group | Southwest Airlines vs. Playa Hotels Resorts |
| ANTA SPORTS vs. PROSIEBENSAT1 MEDIADR4 | ANTA SPORTS vs. Coffee Holding Co | ANTA SPORTS vs. Computershare Limited | ANTA SPORTS vs. ETFS Coffee ETC |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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