Correlation Between Inter Cars and Genomtec
Can any of the company-specific risk be diversified away by investing in both Inter Cars and Genomtec 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 Inter Cars and Genomtec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inter Cars SA and Genomtec SA, you can compare the effects of market volatilities on Inter Cars and Genomtec 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 Inter Cars with a short position of Genomtec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inter Cars and Genomtec.
Diversification Opportunities for Inter Cars and Genomtec
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Inter and Genomtec is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Inter Cars SA and Genomtec SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genomtec SA and Inter Cars 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 Inter Cars SA are associated (or correlated) with Genomtec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genomtec SA has no effect on the direction of Inter Cars i.e., Inter Cars and Genomtec go up and down completely randomly.
Pair Corralation between Inter Cars and Genomtec
Assuming the 90 days trading horizon Inter Cars SA is expected to generate 0.62 times more return on investment than Genomtec. However, Inter Cars SA is 1.63 times less risky than Genomtec. It trades about 0.12 of its potential returns per unit of risk. Genomtec SA is currently generating about -0.01 per unit of risk. If you would invest 49,350 in Inter Cars SA on September 12, 2024 and sell it today you would earn a total of 2,150 from holding Inter Cars SA or generate 4.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Inter Cars SA vs. Genomtec SA
Performance |
| Timeline |
| Inter Cars SA |
| Genomtec SA |
Inter Cars and Genomtec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inter Cars and Genomtec
The main advantage of trading using opposite Inter Cars and Genomtec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inter Cars position performs unexpectedly, Genomtec 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 Genomtec will offset losses from the drop in Genomtec's long position.| Inter Cars vs. Play2Chill SA | Inter Cars vs. Globe Trade Centre | Inter Cars vs. Centrum Finansowe Banku | Inter Cars vs. Echo Investment SA |
| Genomtec vs. X Trade Brokers | Genomtec vs. CI Games SA | Genomtec vs. Detalion Games SA | Genomtec vs. Movie Games SA |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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