Correlation Between Grupo Mxico and Nomad Foods
Can any of the company-specific risk be diversified away by investing in both Grupo Mxico and Nomad Foods 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 Grupo Mxico and Nomad Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Mxico SAB and Nomad Foods, you can compare the effects of market volatilities on Grupo Mxico and Nomad Foods 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 Grupo Mxico with a short position of Nomad Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Mxico and Nomad Foods.
Diversification Opportunities for Grupo Mxico and Nomad Foods
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Grupo and Nomad is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Mxico SAB and Nomad Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nomad Foods and Grupo Mxico 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 Grupo Mxico SAB are associated (or correlated) with Nomad Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nomad Foods has no effect on the direction of Grupo Mxico i.e., Grupo Mxico and Nomad Foods go up and down completely randomly.
Pair Corralation between Grupo Mxico and Nomad Foods
Assuming the 90 days horizon Grupo Mxico SAB is expected to generate 2.45 times more return on investment than Nomad Foods. However, Grupo Mxico is 2.45 times more volatile than Nomad Foods. It trades about 0.12 of its potential returns per unit of risk. Nomad Foods is currently generating about 0.02 per unit of risk. If you would invest 57.00 in Grupo Mxico SAB on November 8, 2024 and sell it today you would earn a total of 413.00 from holding Grupo Mxico SAB or generate 724.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Grupo Mxico SAB vs. Nomad Foods
Performance |
| Timeline |
| Grupo Mxico SAB |
| Nomad Foods |
Grupo Mxico and Nomad Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Mxico and Nomad Foods
The main advantage of trading using opposite Grupo Mxico and Nomad Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Mxico position performs unexpectedly, Nomad Foods 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 Nomad Foods will offset losses from the drop in Nomad Foods' long position.| Grupo Mxico vs. Eidesvik Offshore ASA | Grupo Mxico vs. Semiconductor Manufacturing International | Grupo Mxico vs. TOREX SEMICONDUCTOR LTD | Grupo Mxico vs. ANTA SPORTS PRODUCT |
| Nomad Foods vs. KENEDIX OFFICE INV | Nomad Foods vs. AWILCO DRILLING PLC | Nomad Foods vs. Focus Home Interactive | Nomad Foods vs. TOMBADOR IRON LTD |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |