Correlation Between Almirall and Altia Consultores
Can any of the company-specific risk be diversified away by investing in both Almirall and Altia Consultores 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 Almirall and Altia Consultores into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Almirall SA and Altia Consultores SA, you can compare the effects of market volatilities on Almirall and Altia Consultores 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 Almirall with a short position of Altia Consultores. Check out your portfolio center. Please also check ongoing floating volatility patterns of Almirall and Altia Consultores.
Diversification Opportunities for Almirall and Altia Consultores
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Almirall and Altia is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Almirall SA and Altia Consultores SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altia Consultores and Almirall 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 Almirall SA are associated (or correlated) with Altia Consultores. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altia Consultores has no effect on the direction of Almirall i.e., Almirall and Altia Consultores go up and down completely randomly.
Pair Corralation between Almirall and Altia Consultores
Assuming the 90 days trading horizon Almirall SA is expected to under-perform the Altia Consultores. But the stock apears to be less risky and, when comparing its historical volatility, Almirall SA is 1.5 times less risky than Altia Consultores. The stock trades about -0.05 of its potential returns per unit of risk. The Altia Consultores SA is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 476.00 in Altia Consultores SA on September 3, 2024 and sell it today you would lose (18.00) from holding Altia Consultores SA or give up 3.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Almirall SA vs. Altia Consultores SA
Performance |
| Timeline |
| Almirall SA |
| Altia Consultores |
Almirall and Altia Consultores Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Almirall and Altia Consultores
The main advantage of trading using opposite Almirall and Altia Consultores positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Almirall position performs unexpectedly, Altia Consultores 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 Altia Consultores will offset losses from the drop in Altia Consultores' long position.| Almirall vs. Grifols SA | Almirall vs. Acerinox | Almirall vs. Laboratorios Farmaceuticos ROVI | Almirall vs. ENCE Energa y |
| Altia Consultores vs. Gigas Hosting SA | Altia Consultores vs. NBI Bearings Europe | Altia Consultores vs. Miquel y Costas | Altia Consultores vs. Global Dominion Access |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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