Correlation Between CAP SA and Ingevec
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By analyzing existing cross correlation between CAP SA and Ingevec, you can compare the effects of market volatilities on CAP SA and Ingevec 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 CAP SA with a short position of Ingevec. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAP SA and Ingevec.
Diversification Opportunities for CAP SA and Ingevec
Excellent diversification
The 3 months correlation between CAP and Ingevec is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding CAP SA and Ingevec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingevec and CAP SA 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 CAP SA are associated (or correlated) with Ingevec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingevec has no effect on the direction of CAP SA i.e., CAP SA and Ingevec go up and down completely randomly.
Pair Corralation between CAP SA and Ingevec
Assuming the 90 days trading horizon CAP SA is expected to under-perform the Ingevec. In addition to that, CAP SA is 1.17 times more volatile than Ingevec. It trades about -0.19 of its total potential returns per unit of risk. Ingevec is currently generating about -0.11 per unit of volatility. If you would invest 5,843 in Ingevec on September 19, 2024 and sell it today you would lose (101.00) from holding Ingevec or give up 1.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 72.73% |
| Values | Daily Returns |
CAP SA vs. Ingevec
Performance |
| Timeline |
| CAP SA |
| Ingevec |
CAP SA and Ingevec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CAP SA and Ingevec
The main advantage of trading using opposite CAP SA and Ingevec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAP SA position performs unexpectedly, Ingevec 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 Ingevec will offset losses from the drop in Ingevec's long position.The idea behind CAP SA and Ingevec 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.| Ingevec vs. Aguas Andinas SA | Ingevec vs. Parq Arauco | Ingevec vs. Enel Generacin Chile | Ingevec vs. Sociedad Matriz SAAM |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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