Correlation Between Grupo Carso and Geely Automobile
Can any of the company-specific risk be diversified away by investing in both Grupo Carso and Geely Automobile 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 Geely Automobile 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 Geely Automobile Holdings, you can compare the effects of market volatilities on Grupo Carso and Geely Automobile 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 Geely Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Carso and Geely Automobile.
Diversification Opportunities for Grupo Carso and Geely Automobile
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Grupo and Geely is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Carso SAB and Geely Automobile Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Geely Automobile Holdings 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 Geely Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Geely Automobile Holdings has no effect on the direction of Grupo Carso i.e., Grupo Carso and Geely Automobile go up and down completely randomly.
Pair Corralation between Grupo Carso and Geely Automobile
Assuming the 90 days horizon Grupo Carso is expected to generate 8.93 times less return on investment than Geely Automobile. In addition to that, Grupo Carso is 1.15 times more volatile than Geely Automobile Holdings. It trades about 0.01 of its total potential returns per unit of risk. Geely Automobile Holdings is currently generating about 0.1 per unit of volatility. If you would invest 81.00 in Geely Automobile Holdings on August 26, 2024 and sell it today you would earn a total of 76.00 from holding Geely Automobile Holdings or generate 93.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Carso SAB vs. Geely Automobile Holdings
Performance |
| Timeline |
| Grupo Carso SAB |
| Geely Automobile Holdings |
Grupo Carso and Geely Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Carso and Geely Automobile
The main advantage of trading using opposite Grupo Carso and Geely Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Carso position performs unexpectedly, Geely Automobile 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 Geely Automobile will offset losses from the drop in Geely Automobile's long position.| Grupo Carso vs. Superior Plus Corp | Grupo Carso vs. NMI Holdings | Grupo Carso vs. Origin Agritech | Grupo Carso vs. SIVERS SEMICONDUCTORS AB |
| Geely Automobile vs. Tesla Inc | Geely Automobile vs. Superior Plus Corp | Geely Automobile vs. NMI Holdings | Geely Automobile vs. Origin Agritech |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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