Correlation Between Grupo Carso and NEXANS
Can any of the company-specific risk be diversified away by investing in both Grupo Carso and NEXANS 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 NEXANS 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 NEXANS, you can compare the effects of market volatilities on Grupo Carso and NEXANS 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 NEXANS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Carso and NEXANS.
Diversification Opportunities for Grupo Carso and NEXANS
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Grupo and NEXANS is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Carso SAB and NEXANS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXANS 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 NEXANS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXANS has no effect on the direction of Grupo Carso i.e., Grupo Carso and NEXANS go up and down completely randomly.
Pair Corralation between Grupo Carso and NEXANS
Assuming the 90 days horizon Grupo Carso SAB is expected to under-perform the NEXANS. In addition to that, Grupo Carso is 1.1 times more volatile than NEXANS. It trades about -0.33 of its total potential returns per unit of risk. NEXANS is currently generating about -0.33 per unit of volatility. If you would invest 11,140 in NEXANS on October 10, 2024 and sell it today you would lose (720.00) from holding NEXANS or give up 6.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Carso SAB vs. NEXANS
Performance |
| Timeline |
| Grupo Carso SAB |
| NEXANS |
Grupo Carso and NEXANS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Carso and NEXANS
The main advantage of trading using opposite Grupo Carso and NEXANS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Carso position performs unexpectedly, NEXANS 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 NEXANS will offset losses from the drop in NEXANS's long position.| Grupo Carso vs. SCANDMEDICAL SOLDK 040 | Grupo Carso vs. OBSERVE MEDICAL ASA | Grupo Carso vs. North American Construction | Grupo Carso vs. Penta Ocean Construction Co |
| NEXANS vs. Hollywood Bowl Group | NEXANS vs. Grupo Carso SAB | NEXANS vs. PROSIEBENSAT1 MEDIADR4 | NEXANS vs. Penn National Gaming |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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