Correlation Between Grupo Carso and Diamyd Medical
Can any of the company-specific risk be diversified away by investing in both Grupo Carso and Diamyd Medical 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 Carso and Diamyd Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Carso SAB and Diamyd Medical AB, you can compare the effects of market volatilities on Grupo Carso and Diamyd Medical 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 Carso with a short position of Diamyd Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Carso and Diamyd Medical.
Diversification Opportunities for Grupo Carso and Diamyd Medical
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grupo and Diamyd is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Carso SAB and Diamyd Medical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diamyd Medical AB and Grupo Carso 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 Carso SAB are associated (or correlated) with Diamyd Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diamyd Medical AB has no effect on the direction of Grupo Carso i.e., Grupo Carso and Diamyd Medical go up and down completely randomly.
Pair Corralation between Grupo Carso and Diamyd Medical
Assuming the 90 days horizon Grupo Carso SAB is expected to generate 0.94 times more return on investment than Diamyd Medical. However, Grupo Carso SAB is 1.06 times less risky than Diamyd Medical. It trades about 0.05 of its potential returns per unit of risk. Diamyd Medical AB is currently generating about -0.28 per unit of risk. If you would invest 550.00 in Grupo Carso SAB on November 28, 2024 and sell it today you would earn a total of 10.00 from holding Grupo Carso SAB or generate 1.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Carso SAB vs. Diamyd Medical AB
Performance |
| Timeline |
| Grupo Carso SAB |
| Diamyd Medical AB |
Grupo Carso and Diamyd Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Carso and Diamyd Medical
The main advantage of trading using opposite Grupo Carso and Diamyd Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Carso position performs unexpectedly, Diamyd Medical 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 Diamyd Medical will offset losses from the drop in Diamyd Medical's long position.| Grupo Carso vs. China Communications Construction | Grupo Carso vs. FRACTAL GAMING GROUP | Grupo Carso vs. MOVIE GAMES SA | Grupo Carso vs. COMPUTER MODELLING |
| Diamyd Medical vs. Harmony Gold Mining | Diamyd Medical vs. Perseus Mining Limited | Diamyd Medical vs. CORNISH METALS INC | Diamyd Medical vs. United Airlines Holdings |
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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