Correlation Between Grupo Aeroportuario and KLA Tencor
Can any of the company-specific risk be diversified away by investing in both Grupo Aeroportuario and KLA Tencor 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 KLA Tencor 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 KLA Tencor, you can compare the effects of market volatilities on Grupo Aeroportuario and KLA Tencor 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 KLA Tencor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Aeroportuario and KLA Tencor.
Diversification Opportunities for Grupo Aeroportuario and KLA Tencor
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Grupo and KLA is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Aeroportuario del and KLA Tencor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KLA Tencor 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 KLA Tencor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KLA Tencor has no effect on the direction of Grupo Aeroportuario i.e., Grupo Aeroportuario and KLA Tencor go up and down completely randomly.
Pair Corralation between Grupo Aeroportuario and KLA Tencor
Considering the 90-day investment horizon Grupo Aeroportuario is expected to generate 2.63 times less return on investment than KLA Tencor. But when comparing it to its historical volatility, Grupo Aeroportuario del is 1.05 times less risky than KLA Tencor. It trades about 0.02 of its potential returns per unit of risk. KLA Tencor is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 36,611 in KLA Tencor on September 12, 2024 and sell it today you would earn a total of 27,576 from holding KLA Tencor or generate 75.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Aeroportuario del vs. KLA Tencor
Performance |
| Timeline |
| Grupo Aeroportuario del |
| KLA Tencor |
Grupo Aeroportuario and KLA Tencor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Aeroportuario and KLA Tencor
The main advantage of trading using opposite Grupo Aeroportuario and KLA Tencor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Aeroportuario position performs unexpectedly, KLA Tencor 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 KLA Tencor will offset losses from the drop in KLA Tencor's 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 |
| KLA Tencor vs. Applied Materials | KLA Tencor vs. ASML Holding NV | KLA Tencor vs. Axcelis Technologies | KLA Tencor vs. Teradyne |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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