Southwest Airlines Correlations

SWN Stock

EUR 30.55 0.22 0.73%

The current 90-days correlation between Southwest Airlines and Ryanair Holdings plc is 0.13 (i.e., Average diversification). The correlation of Southwest Airlines is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.

Southwest Airlines Correlation With Market

Good diversification

The correlation between Southwest Airlines Co and DJI is -0.19 (i.e., Good diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Southwest Airlines Co and DJI in the same portfolio, assuming nothing else is changed.

The ability to find closely correlated positions to Southwest Airlines could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Southwest Airlines when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Southwest Airlines - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Southwest Airlines Co to buy it.

Moving together with Southwest Stock

0.92	OYC	Delta Air Lines	Pair Corr
0.85	AD2	Air China Limited	Pair Corr
0.86	AD2B	AIR CHINA LTD	Pair Corr
0.83	ZNHH	China Southern Airlines	Pair Corr
0.83	RY4C	Ryanair Holdings plc	Pair Corr
0.8	RY4C	Ryanair Holdings plc	Pair Corr
0.88	ADH2	Air Canada	Pair Corr

Moving against Southwest Stock

0.73	CXT	Carmat SA	Pair Corr
0.61	MTO	METTLER TOLEDO INTL	Pair Corr
0.61	MTO	METTLER TOLEDO INTL	Pair Corr
0.61	MTO	Mitie Group PLC	Pair Corr
0.4	DBPD	Xtrackers ShortDAX	Pair Corr

Related Correlations Analysis

	RY4C	8SP	6NM	39O1	2DG	TLX	2GB	TM9
RY4C		-0.82	-0.4	-0.11	-0.84	-0.19	0.48	-0.16	RY4C
8SP	-0.82		0.61	0.31	0.76	0.13	-0.34	0.3	8SP
6NM	-0.4	0.61		0.45	0.24	0.3	0.03	0.2	6NM
39O1	-0.11	0.31	0.45		0.19	-0.2	0.3	0.44	39O1
2DG	-0.84	0.76	0.24	0.19		-0.03	-0.35	0.21	2DG
TLX	-0.19	0.13	0.3	-0.2	-0.03		-0.16	-0.1	TLX
2GB	0.48	-0.34	0.03	0.3	-0.35	-0.16		-0.02	2GB
TM9	-0.16	0.3	0.2	0.44	0.21	-0.1	-0.02		TM9
	RY4C	8SP	6NM	39O1	2DG	TLX	2GB	TM9

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.

High positive correlations

2DG	+ 0.76	8SP
6NM	+ 0.61	8SP
2GB	+ 0.48	RY4C
39O1	+ 0.45	6NM
TM9	+ 0.44	39O1
39O1	+ 0.31	8SP

High negative correlations

2DG	- 0.84	RY4C
8SP	- 0.82	RY4C
6NM	- 0.4	RY4C
2GB	- 0.35	2DG
2GB	- 0.34	8SP
TLX	- 0.2	39O1

Risk-Adjusted Indicators

There is a big difference between Southwest Stock performing well and Southwest Airlines Company doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Southwest Airlines' multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

	Mean Deviation	Jensen Alpha	Sortino Ratio	Treynor Ratio	Semi Deviation	Expected Shortfall	Potential Upside	Value @Risk	Maximum Drawdown
RY4C	1.27	0.21	0.08	1.53	1.16	(1.54)	3.53	(2.26)	9.27
8SP	2.06	(0.09)	0.00	0.29	0.00	0.00	3.36	(4.74)	20.22
6NM	1.25	0.14	(0.01)	(0.31)	1.76	(1.37)	2.89	(2.69)	9.64
39O1	3.52	0.01	(0.01)	0.13	3.50	(4.94)	8.41	(5.38)	24.06
2DG	4.16	(1.30)	0.00	(2.09)	0.00	0.00	7.14	(8.57)	52.42
TLX	0.97	0.04	(0.06)	23.18	1.13	(1.12)	2.67	(1.64)	7.58
2GB	1.82	0.02	(0.02)	0.16	2.20	(2.08)	4.28	(3.67)	13.78
TM9	2.83	(0.11)	0.00	(0.18)	0.00	0.00	5.56	(6.43)	36.50

Be your own money manager

Our tools can tell you how much better you can do entering a position in Southwest Airlines without increasing your portfolio risk or giving up the expected return. As an individual investor, you need to find a reliable way to track all your investment portfolios. However, your requirements will often be based on how much of the process you decide to do yourself. In addition to allowing all investors analytical transparency into all their portfolios, our tools can evaluate risk-adjusted returns of your individual positions relative to your overall portfolio.

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