Correlation Between Autopistas Del and Telecom Argentina
Can any of the company-specific risk be diversified away by investing in both Autopistas Del and Telecom Argentina 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 Autopistas Del and Telecom Argentina into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Autopistas del Sol and Telecom Argentina, you can compare the effects of market volatilities on Autopistas Del and Telecom Argentina 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 Autopistas Del with a short position of Telecom Argentina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autopistas Del and Telecom Argentina.
Diversification Opportunities for Autopistas Del and Telecom Argentina
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Autopistas and Telecom is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Autopistas del Sol and Telecom Argentina in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telecom Argentina and Autopistas Del 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 Autopistas del Sol are associated (or correlated) with Telecom Argentina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telecom Argentina has no effect on the direction of Autopistas Del i.e., Autopistas Del and Telecom Argentina go up and down completely randomly.
Pair Corralation between Autopistas Del and Telecom Argentina
Assuming the 90 days trading horizon Autopistas Del is expected to generate 1.18 times less return on investment than Telecom Argentina. But when comparing it to its historical volatility, Autopistas del Sol is 1.51 times less risky than Telecom Argentina. It trades about 0.12 of its potential returns per unit of risk. Telecom Argentina is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 204,105 in Telecom Argentina on September 25, 2024 and sell it today you would earn a total of 81,395 from holding Telecom Argentina or generate 39.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autopistas del Sol vs. Telecom Argentina
Performance |
| Timeline |
| Autopistas del Sol |
| Telecom Argentina |
Autopistas Del and Telecom Argentina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autopistas Del and Telecom Argentina
The main advantage of trading using opposite Autopistas Del and Telecom Argentina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autopistas Del position performs unexpectedly, Telecom Argentina 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 Telecom Argentina will offset losses from the drop in Telecom Argentina's long position.| Autopistas Del vs. Telecom Argentina | Autopistas Del vs. Compania de Transporte | Autopistas Del vs. Agrometal SAI | Autopistas Del vs. Harmony Gold Mining |
| Telecom Argentina vs. Grupo Televisa SAB | Telecom Argentina vs. YPF SA D | Telecom Argentina vs. Capex SA | Telecom Argentina vs. Carboclor |
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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