Correlation Between Grupo Bimbo and Amincor
Can any of the company-specific risk be diversified away by investing in both Grupo Bimbo and Amincor 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 Bimbo and Amincor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Bimbo SAB and Amincor, you can compare the effects of market volatilities on Grupo Bimbo and Amincor 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 Bimbo with a short position of Amincor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Bimbo and Amincor.
Diversification Opportunities for Grupo Bimbo and Amincor
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grupo and Amincor is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Bimbo SAB and Amincor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amincor and Grupo Bimbo 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 Bimbo SAB are associated (or correlated) with Amincor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amincor has no effect on the direction of Grupo Bimbo i.e., Grupo Bimbo and Amincor go up and down completely randomly.
Pair Corralation between Grupo Bimbo and Amincor
Assuming the 90 days horizon Grupo Bimbo SAB is expected to under-perform the Amincor. But the pink sheet apears to be less risky and, when comparing its historical volatility, Grupo Bimbo SAB is 19.5 times less risky than Amincor. The pink sheet trades about -0.09 of its potential returns per unit of risk. The Amincor is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 9.00 in Amincor on August 28, 2024 and sell it today you would earn a total of 5.00 from holding Amincor or generate 55.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Bimbo SAB vs. Amincor
Performance |
| Timeline |
| Grupo Bimbo SAB |
| Amincor |
Grupo Bimbo and Amincor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Bimbo and Amincor
The main advantage of trading using opposite Grupo Bimbo and Amincor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Bimbo position performs unexpectedly, Amincor 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 Amincor will offset losses from the drop in Amincor's long position.The idea behind Grupo Bimbo SAB and Amincor pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Amincor vs. BAB Inc | Amincor vs. FitLife Brands, Common | Amincor vs. The A2 Milk | Amincor vs. Artisan Consumer Goods |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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