Correlation Between Gol Intelligent and China International

Can any of the company-specific risk be diversified away by investing in both Gol Intelligent and China International 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 Gol Intelligent and China International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Gol Intelligent Airlines and China International Marine, you can compare the effects of market volatilities on Gol Intelligent and China International 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 Gol Intelligent with a short position of China International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gol Intelligent and China International.

Diversification Opportunities for Gol Intelligent and China International

0.0

Correlation Coefficient

Gol Intelligent  China International

Pay attention - limited upside

The 3 months correlation between Gol and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Gol Intelligent Airlines and China International Marine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China International and Gol Intelligent 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 Gol Intelligent Airlines are associated (or correlated) with China International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China International has no effect on the direction of Gol Intelligent i.e., Gol Intelligent and China International go up and down completely randomly.

Pair Corralation between Gol Intelligent and China International

If you would invest  42.00  in Gol Intelligent Airlines on October 11, 2024 and sell it today you would earn a total of  0.00  from holding Gol Intelligent Airlines or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.67%
Values	Daily Returns

Gol Intelligent Airlines  vs.  China International Marine

Gol Intelligent Airlines

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gol Intelligent Airlines has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Gol Intelligent is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

China International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days China International Marine has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Gol Intelligent and China International

The main advantage of trading using opposite Gol Intelligent and China International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gol Intelligent position performs unexpectedly, China International 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 China International will offset losses from the drop in China International's long position.

The idea behind Gol Intelligent Airlines and China International Marine pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.