Correlation Between Corporacion Financiera and Mistral Patrimonio
Can any of the company-specific risk be diversified away by investing in both Corporacion Financiera and Mistral Patrimonio 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 Corporacion Financiera and Mistral Patrimonio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corporacion Financiera Alba and Mistral Patrimonio Inmobiliario, you can compare the effects of market volatilities on Corporacion Financiera and Mistral Patrimonio 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 Corporacion Financiera with a short position of Mistral Patrimonio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporacion Financiera and Mistral Patrimonio.
Diversification Opportunities for Corporacion Financiera and Mistral Patrimonio
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Corporacion and Mistral is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Corporacion Financiera Alba and Mistral Patrimonio Inmobiliari in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mistral Patrimonio and Corporacion Financiera 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 Corporacion Financiera Alba are associated (or correlated) with Mistral Patrimonio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mistral Patrimonio has no effect on the direction of Corporacion Financiera i.e., Corporacion Financiera and Mistral Patrimonio go up and down completely randomly.
Pair Corralation between Corporacion Financiera and Mistral Patrimonio
Assuming the 90 days trading horizon Corporacion Financiera is expected to generate 10.71 times less return on investment than Mistral Patrimonio. But when comparing it to its historical volatility, Corporacion Financiera Alba is 6.61 times less risky than Mistral Patrimonio. It trades about 0.05 of its potential returns per unit of risk. Mistral Patrimonio Inmobiliario is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 189.00 in Mistral Patrimonio Inmobiliario on November 2, 2024 and sell it today you would lose (101.00) from holding Mistral Patrimonio Inmobiliario or give up 53.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 77.73% |
| Values | Daily Returns |
Corporacion Financiera Alba vs. Mistral Patrimonio Inmobiliari
Performance |
| Timeline |
| Corporacion Financiera |
| Mistral Patrimonio |
Corporacion Financiera and Mistral Patrimonio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Corporacion Financiera and Mistral Patrimonio
The main advantage of trading using opposite Corporacion Financiera and Mistral Patrimonio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corporacion Financiera position performs unexpectedly, Mistral Patrimonio 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 Mistral Patrimonio will offset losses from the drop in Mistral Patrimonio's long position.| Corporacion Financiera vs. Miquel y Costas | Corporacion Financiera vs. Grupo Catalana Occidente | Corporacion Financiera vs. Construcciones y Auxiliar | Corporacion Financiera vs. Prosegur |
| Mistral Patrimonio vs. Atrys Health SL | Mistral Patrimonio vs. Media Investment Optimization | Mistral Patrimonio vs. Neinor Homes SLU | Mistral Patrimonio vs. Elaia Investment Spain |
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.
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