Correlation Between Aegon NV and Grupo Simec
Can any of the company-specific risk be diversified away by investing in both Aegon NV and Grupo Simec 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 Aegon NV and Grupo Simec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegon NV ADR and Grupo Simec SAB, you can compare the effects of market volatilities on Aegon NV and Grupo Simec 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 Aegon NV with a short position of Grupo Simec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and Grupo Simec.
Diversification Opportunities for Aegon NV and Grupo Simec
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aegon and Grupo is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV ADR and Grupo Simec SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Simec SAB and Aegon NV 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 Aegon NV ADR are associated (or correlated) with Grupo Simec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Simec SAB has no effect on the direction of Aegon NV i.e., Aegon NV and Grupo Simec go up and down completely randomly.
Pair Corralation between Aegon NV and Grupo Simec
Considering the 90-day investment horizon Aegon NV ADR is expected to generate 0.57 times more return on investment than Grupo Simec. However, Aegon NV ADR is 1.75 times less risky than Grupo Simec. It trades about 0.02 of its potential returns per unit of risk. Grupo Simec SAB is currently generating about -0.07 per unit of risk. If you would invest 610.00 in Aegon NV ADR on August 26, 2024 and sell it today you would earn a total of 13.00 from holding Aegon NV ADR or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 87.4% |
| Values | Daily Returns |
Aegon NV ADR vs. Grupo Simec SAB
Performance |
| Timeline |
| Aegon NV ADR |
| Grupo Simec SAB |
Aegon NV and Grupo Simec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegon NV and Grupo Simec
The main advantage of trading using opposite Aegon NV and Grupo Simec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, Grupo Simec 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 Grupo Simec will offset losses from the drop in Grupo Simec's long position.| Aegon NV vs. Hartford Financial Services | Aegon NV vs. Goosehead Insurance | Aegon NV vs. International General Insurance | Aegon NV vs. Enstar Group Limited |
| Grupo Simec vs. Synalloy | Grupo Simec vs. Mesabi Trust | Grupo Simec vs. Algoma Steel Group | Grupo Simec vs. Olympic Steel |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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