Correlation Between Capex SA and Walt Disney
Can any of the company-specific risk be diversified away by investing in both Capex SA and Walt Disney 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 Capex SA and Walt Disney into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capex SA and Walt Disney, you can compare the effects of market volatilities on Capex SA and Walt Disney 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 Capex SA with a short position of Walt Disney. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capex SA and Walt Disney.
Diversification Opportunities for Capex SA and Walt Disney
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Capex and Walt is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Capex SA and Walt Disney in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walt Disney and Capex 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 Capex SA are associated (or correlated) with Walt Disney. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walt Disney has no effect on the direction of Capex SA i.e., Capex SA and Walt Disney go up and down completely randomly.
Pair Corralation between Capex SA and Walt Disney
Assuming the 90 days trading horizon Capex SA is expected to generate 1.5 times more return on investment than Walt Disney. However, Capex SA is 1.5 times more volatile than Walt Disney. It trades about 0.16 of its potential returns per unit of risk. Walt Disney is currently generating about 0.13 per unit of risk. If you would invest 70,500 in Capex SA on August 31, 2024 and sell it today you would earn a total of 804,500 from holding Capex SA or generate 1141.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capex SA vs. Walt Disney
Performance |
| Timeline |
| Capex SA |
| Walt Disney |
Capex SA and Walt Disney Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capex SA and Walt Disney
The main advantage of trading using opposite Capex SA and Walt Disney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capex SA position performs unexpectedly, Walt Disney 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 Walt Disney will offset losses from the drop in Walt Disney's long position.| Capex SA vs. Transportadora de Gas | Capex SA vs. Harmony Gold Mining | Capex SA vs. Compania de Transporte | Capex SA vs. Agrometal SAI |
| Walt Disney vs. Agrometal SAI | Walt Disney vs. Transportadora de Gas | Walt Disney vs. Harmony Gold Mining | Walt Disney vs. Telecom Argentina |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |