Correlation Between Aenza SAA and Eiffage SA
Can any of the company-specific risk be diversified away by investing in both Aenza SAA and Eiffage 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 Aenza SAA and Eiffage SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aenza SAA and Eiffage SA ADR, you can compare the effects of market volatilities on Aenza SAA and Eiffage 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 Aenza SAA with a short position of Eiffage SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aenza SAA and Eiffage SA.
Diversification Opportunities for Aenza SAA and Eiffage SA
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aenza and Eiffage is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Aenza SAA and Eiffage SA ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eiffage SA ADR and Aenza SAA 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 Aenza SAA are associated (or correlated) with Eiffage SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eiffage SA ADR has no effect on the direction of Aenza SAA i.e., Aenza SAA and Eiffage SA go up and down completely randomly.
Pair Corralation between Aenza SAA and Eiffage SA
If you would invest 181.00 in Aenza SAA on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Aenza SAA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Aenza SAA vs. Eiffage SA ADR
Performance |
| Timeline |
| Aenza SAA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Eiffage SA ADR |
Aenza SAA and Eiffage SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aenza SAA and Eiffage SA
The main advantage of trading using opposite Aenza SAA and Eiffage SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aenza SAA position performs unexpectedly, Eiffage 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 Eiffage SA will offset losses from the drop in Eiffage SA's long position.| Aenza SAA vs. Bowman Consulting Group | Aenza SAA vs. Api Group Corp | Aenza SAA vs. ACS Actividades de | Aenza SAA vs. ACS Actividades De |
| Eiffage SA vs. Concrete Pumping Holdings | Eiffage SA vs. ACS Actividades de | Eiffage SA vs. ACS Actividades De | Eiffage SA vs. Badger Infrastructure Solutions |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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