Correlation Between Administradora Americana and CAP SA
Can any of the company-specific risk be diversified away by investing in both Administradora Americana and CAP SA 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 Administradora Americana and CAP SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Administradora Americana de and CAP SA, you can compare the effects of market volatilities on Administradora Americana and CAP SA 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 Administradora Americana with a short position of CAP SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Administradora Americana and CAP SA.
Diversification Opportunities for Administradora Americana and CAP SA
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Administradora and CAP is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Administradora Americana de and CAP SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAP SA and Administradora Americana 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 Administradora Americana de are associated (or correlated) with CAP SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAP SA has no effect on the direction of Administradora Americana i.e., Administradora Americana and CAP SA go up and down completely randomly.
Pair Corralation between Administradora Americana and CAP SA
Assuming the 90 days trading horizon Administradora Americana de is expected to generate 0.89 times more return on investment than CAP SA. However, Administradora Americana de is 1.13 times less risky than CAP SA. It trades about 0.29 of its potential returns per unit of risk. CAP SA is currently generating about -0.27 per unit of risk. If you would invest 17,640 in Administradora Americana de on September 1, 2024 and sell it today you would earn a total of 1,399 from holding Administradora Americana de or generate 7.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Administradora Americana de vs. CAP SA
Performance |
| Timeline |
| Administradora Americana |
| CAP SA |
Administradora Americana and CAP SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Administradora Americana and CAP SA
The main advantage of trading using opposite Administradora Americana and CAP SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Administradora Americana position performs unexpectedly, CAP SA 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 CAP SA will offset losses from the drop in CAP SA's long position.| Administradora Americana vs. Salfacorp | Administradora Americana vs. Schwager | Administradora Americana vs. HMC SA ADMINISTRADORA | Administradora Americana vs. Multiexport Foods SA |
| CAP SA vs. Administradora Americana de | CAP SA vs. Energia Latina SA | CAP SA vs. Embotelladora Andina SA | CAP SA vs. Salfacorp |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |