Correlation Between Compania and Union De
Specify exactly 2 symbols:
By analyzing existing cross correlation between Compania de Minas and Union de Cervecerias, you can compare the effects of market volatilities on Compania and Union De 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 Compania with a short position of Union De. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compania and Union De.
Diversification Opportunities for Compania and Union De
Excellent diversification
The 3 months correlation between Compania and Union is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Compania de Minas and Union de Cervecerias in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union de Cervecerias and Compania 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 Compania de Minas are associated (or correlated) with Union De. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union de Cervecerias has no effect on the direction of Compania i.e., Compania and Union De go up and down completely randomly.
Pair Corralation between Compania and Union De
Assuming the 90 days trading horizon Compania de Minas is expected to under-perform the Union De. In addition to that, Compania is 2.27 times more volatile than Union de Cervecerias. It trades about -0.18 of its total potential returns per unit of risk. Union de Cervecerias is currently generating about 0.02 per unit of volatility. If you would invest 2,100 in Union de Cervecerias on September 5, 2024 and sell it today you would earn a total of 20.00 from holding Union de Cervecerias or generate 0.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.56% |
| Values | Daily Returns |
Compania de Minas vs. Union de Cervecerias
Performance |
| Timeline |
| Compania de Minas |
| Union de Cervecerias |
Compania and Union De Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compania and Union De
The main advantage of trading using opposite Compania and Union De positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compania position performs unexpectedly, Union De 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 Union De will offset losses from the drop in Union De's long position.The idea behind Compania de Minas and Union de Cervecerias 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.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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |