Correlation Between Grupo Aeroportuario and CF Industries
Can any of the company-specific risk be diversified away by investing in both Grupo Aeroportuario and CF Industries 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 Grupo Aeroportuario and CF Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Aeroportuario del and CF Industries Holdings, you can compare the effects of market volatilities on Grupo Aeroportuario and CF Industries 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 Grupo Aeroportuario with a short position of CF Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Aeroportuario and CF Industries.
Diversification Opportunities for Grupo Aeroportuario and CF Industries
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grupo and CF Industries is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Aeroportuario del and CF Industries Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CF Industries Holdings and Grupo Aeroportuario 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 Grupo Aeroportuario del are associated (or correlated) with CF Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CF Industries Holdings has no effect on the direction of Grupo Aeroportuario i.e., Grupo Aeroportuario and CF Industries go up and down completely randomly.
Pair Corralation between Grupo Aeroportuario and CF Industries
Considering the 90-day investment horizon Grupo Aeroportuario del is expected to generate 0.87 times more return on investment than CF Industries. However, Grupo Aeroportuario del is 1.15 times less risky than CF Industries. It trades about 0.01 of its potential returns per unit of risk. CF Industries Holdings is currently generating about -0.23 per unit of risk. If you would invest 27,406 in Grupo Aeroportuario del on November 27, 2024 and sell it today you would lose (55.00) from holding Grupo Aeroportuario del or give up 0.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Aeroportuario del vs. CF Industries Holdings
Performance |
| Timeline |
| Grupo Aeroportuario del |
| CF Industries Holdings |
Grupo Aeroportuario and CF Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Aeroportuario and CF Industries
The main advantage of trading using opposite Grupo Aeroportuario and CF Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Aeroportuario position performs unexpectedly, CF Industries 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 CF Industries will offset losses from the drop in CF Industries' long position.| Grupo Aeroportuario vs. Grupo Aeroportuario del | Grupo Aeroportuario vs. Corporacion America Airports | Grupo Aeroportuario vs. AerSale Corp | Grupo Aeroportuario vs. Flughafen Zrich AG |
| CF Industries vs. Nutrien | CF Industries vs. Intrepid Potash | CF Industries vs. Corteva | CF Industries vs. ICL Israel Chemicals |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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