Correlation Between GRUPO CARSO-A1 and STORE ELECTRONIC
Can any of the company-specific risk be diversified away by investing in both GRUPO CARSO-A1 and STORE ELECTRONIC 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-A1 and STORE ELECTRONIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GRUPO CARSO A1 and STORE ELECTRONIC, you can compare the effects of market volatilities on GRUPO CARSO-A1 and STORE ELECTRONIC 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-A1 with a short position of STORE ELECTRONIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRUPO CARSO-A1 and STORE ELECTRONIC.
Diversification Opportunities for GRUPO CARSO-A1 and STORE ELECTRONIC
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GRUPO and STORE is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding GRUPO CARSO A1 and STORE ELECTRONIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STORE ELECTRONIC and GRUPO CARSO-A1 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 A1 are associated (or correlated) with STORE ELECTRONIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STORE ELECTRONIC has no effect on the direction of GRUPO CARSO-A1 i.e., GRUPO CARSO-A1 and STORE ELECTRONIC go up and down completely randomly.
Pair Corralation between GRUPO CARSO-A1 and STORE ELECTRONIC
Assuming the 90 days trading horizon GRUPO CARSO-A1 is expected to generate 1.38 times less return on investment than STORE ELECTRONIC. In addition to that, GRUPO CARSO-A1 is 1.39 times more volatile than STORE ELECTRONIC. It trades about 0.07 of its total potential returns per unit of risk. STORE ELECTRONIC is currently generating about 0.13 per unit of volatility. If you would invest 13,930 in STORE ELECTRONIC on November 6, 2024 and sell it today you would earn a total of 2,950 from holding STORE ELECTRONIC or generate 21.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRUPO CARSO A1 vs. STORE ELECTRONIC
Performance |
| Timeline |
| GRUPO CARSO A1 |
| STORE ELECTRONIC |
GRUPO CARSO-A1 and STORE ELECTRONIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRUPO CARSO-A1 and STORE ELECTRONIC
The main advantage of trading using opposite GRUPO CARSO-A1 and STORE ELECTRONIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRUPO CARSO-A1 position performs unexpectedly, STORE ELECTRONIC 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 STORE ELECTRONIC will offset losses from the drop in STORE ELECTRONIC's long position.| GRUPO CARSO-A1 vs. Ross Stores | GRUPO CARSO-A1 vs. The Boston Beer | GRUPO CARSO-A1 vs. Monster Beverage Corp | GRUPO CARSO-A1 vs. H2O Retailing |
| STORE ELECTRONIC vs. MAVEN WIRELESS SWEDEN | STORE ELECTRONIC vs. SEI INVESTMENTS | STORE ELECTRONIC vs. Air Lease | STORE ELECTRONIC vs. CDL INVESTMENT |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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