Correlation Between Compania Cervecerias and GEN Restaurant
Can any of the company-specific risk be diversified away by investing in both Compania Cervecerias and GEN Restaurant 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 Compania Cervecerias and GEN Restaurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compania Cervecerias Unidas and GEN Restaurant Group,, you can compare the effects of market volatilities on Compania Cervecerias and GEN Restaurant 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 Cervecerias with a short position of GEN Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compania Cervecerias and GEN Restaurant.
Diversification Opportunities for Compania Cervecerias and GEN Restaurant
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Compania and GEN is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Compania Cervecerias Unidas and GEN Restaurant Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GEN Restaurant Group, and Compania Cervecerias 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 Cervecerias Unidas are associated (or correlated) with GEN Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GEN Restaurant Group, has no effect on the direction of Compania Cervecerias i.e., Compania Cervecerias and GEN Restaurant go up and down completely randomly.
Pair Corralation between Compania Cervecerias and GEN Restaurant
Considering the 90-day investment horizon Compania Cervecerias Unidas is expected to generate 0.43 times more return on investment than GEN Restaurant. However, Compania Cervecerias Unidas is 2.31 times less risky than GEN Restaurant. It trades about 0.05 of its potential returns per unit of risk. GEN Restaurant Group, is currently generating about -0.03 per unit of risk. If you would invest 1,105 in Compania Cervecerias Unidas on October 26, 2024 and sell it today you would earn a total of 89.00 from holding Compania Cervecerias Unidas or generate 8.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compania Cervecerias Unidas vs. GEN Restaurant Group,
Performance |
| Timeline |
| Compania Cervecerias |
| GEN Restaurant Group, |
Compania Cervecerias and GEN Restaurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compania Cervecerias and GEN Restaurant
The main advantage of trading using opposite Compania Cervecerias and GEN Restaurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compania Cervecerias position performs unexpectedly, GEN Restaurant 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 GEN Restaurant will offset losses from the drop in GEN Restaurant's long position.| Compania Cervecerias vs. Boston Beer | Compania Cervecerias vs. Molson Coors Beverage | Compania Cervecerias vs. Ambev SA ADR | Compania Cervecerias vs. Molson Coors Brewing |
| GEN Restaurant vs. Compania Cervecerias Unidas | GEN Restaurant vs. SBM Offshore NV | GEN Restaurant vs. Boston Beer | GEN Restaurant vs. The Cheesecake Factory |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |