Correlation Between Aena SA and Grupo Ezentis
Can any of the company-specific risk be diversified away by investing in both Aena SA and Grupo Ezentis 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 Aena SA and Grupo Ezentis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aena SA and Grupo Ezentis SA, you can compare the effects of market volatilities on Aena SA and Grupo Ezentis 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 Aena SA with a short position of Grupo Ezentis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aena SA and Grupo Ezentis.
Diversification Opportunities for Aena SA and Grupo Ezentis
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Aena and Grupo is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Aena SA and Grupo Ezentis SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Ezentis SA and Aena SA 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 Aena SA are associated (or correlated) with Grupo Ezentis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Ezentis SA has no effect on the direction of Aena SA i.e., Aena SA and Grupo Ezentis go up and down completely randomly.
Pair Corralation between Aena SA and Grupo Ezentis
Assuming the 90 days trading horizon Aena SA is expected to generate 2.41 times less return on investment than Grupo Ezentis. But when comparing it to its historical volatility, Aena SA is 2.57 times less risky than Grupo Ezentis. It trades about 0.25 of its potential returns per unit of risk. Grupo Ezentis SA is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 9.60 in Grupo Ezentis SA on November 28, 2024 and sell it today you would earn a total of 1.40 from holding Grupo Ezentis SA or generate 14.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Aena SA vs. Grupo Ezentis SA
Performance |
| Timeline |
| Aena SA |
| Grupo Ezentis SA |
Aena SA and Grupo Ezentis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aena SA and Grupo Ezentis
The main advantage of trading using opposite Aena SA and Grupo Ezentis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aena SA position performs unexpectedly, Grupo Ezentis 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 Ezentis will offset losses from the drop in Grupo Ezentis' long position.| Aena SA vs. Biotechnology Assets SA | Aena SA vs. Borges Agricultural Industrial | Aena SA vs. All Iron Re | Aena SA vs. Azaria Rental SOCIMI |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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