Correlation Between Grupo Aval and TechnoPro Holdings
Can any of the company-specific risk be diversified away by investing in both Grupo Aval and TechnoPro Holdings 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 Aval and TechnoPro Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Aval Acciones and TechnoPro Holdings, you can compare the effects of market volatilities on Grupo Aval and TechnoPro Holdings 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 Aval with a short position of TechnoPro Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Aval and TechnoPro Holdings.
Diversification Opportunities for Grupo Aval and TechnoPro Holdings
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grupo and TechnoPro is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Aval Acciones and TechnoPro Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TechnoPro Holdings and Grupo Aval 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 Aval Acciones are associated (or correlated) with TechnoPro Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TechnoPro Holdings has no effect on the direction of Grupo Aval i.e., Grupo Aval and TechnoPro Holdings go up and down completely randomly.
Pair Corralation between Grupo Aval and TechnoPro Holdings
Assuming the 90 days trading horizon Grupo Aval Acciones is expected to generate 1.04 times more return on investment than TechnoPro Holdings. However, Grupo Aval is 1.04 times more volatile than TechnoPro Holdings. It trades about 0.01 of its potential returns per unit of risk. TechnoPro Holdings is currently generating about -0.02 per unit of risk. If you would invest 197.00 in Grupo Aval Acciones on September 2, 2024 and sell it today you would lose (6.00) from holding Grupo Aval Acciones or give up 3.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Aval Acciones vs. TechnoPro Holdings
Performance |
| Timeline |
| Grupo Aval Acciones |
| TechnoPro Holdings |
Grupo Aval and TechnoPro Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Aval and TechnoPro Holdings
The main advantage of trading using opposite Grupo Aval and TechnoPro Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Aval position performs unexpectedly, TechnoPro Holdings 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 TechnoPro Holdings will offset losses from the drop in TechnoPro Holdings' long position.| Grupo Aval vs. Westinghouse Air Brake | Grupo Aval vs. Norwegian Air Shuttle | Grupo Aval vs. MYFAIR GOLD P | Grupo Aval vs. Digilife Technologies Limited |
| TechnoPro Holdings vs. Cogent Communications Holdings | TechnoPro Holdings vs. TAL Education Group | TechnoPro Holdings vs. SK TELECOM TDADR | TechnoPro Holdings vs. Xinhua Winshare Publishing |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |