Correlation Between Central Puerto and Garovaglio
Can any of the company-specific risk be diversified away by investing in both Central Puerto and Garovaglio 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 Central Puerto and Garovaglio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Central Puerto SA and Garovaglio y Zorraquin, you can compare the effects of market volatilities on Central Puerto and Garovaglio 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 Central Puerto with a short position of Garovaglio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Puerto and Garovaglio.
Diversification Opportunities for Central Puerto and Garovaglio
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Central and Garovaglio is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Central Puerto SA and Garovaglio y Zorraquin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garovaglio y Zorraquin and Central Puerto 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 Central Puerto SA are associated (or correlated) with Garovaglio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garovaglio y Zorraquin has no effect on the direction of Central Puerto i.e., Central Puerto and Garovaglio go up and down completely randomly.
Pair Corralation between Central Puerto and Garovaglio
Assuming the 90 days trading horizon Central Puerto SA is expected to generate 0.78 times more return on investment than Garovaglio. However, Central Puerto SA is 1.28 times less risky than Garovaglio. It trades about 0.34 of its potential returns per unit of risk. Garovaglio y Zorraquin is currently generating about 0.01 per unit of risk. If you would invest 130,500 in Central Puerto SA on August 26, 2024 and sell it today you would earn a total of 25,500 from holding Central Puerto SA or generate 19.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Puerto SA vs. Garovaglio y Zorraquin
Performance |
| Timeline |
| Central Puerto SA |
| Garovaglio y Zorraquin |
Central Puerto and Garovaglio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Puerto and Garovaglio
The main advantage of trading using opposite Central Puerto and Garovaglio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Puerto position performs unexpectedly, Garovaglio 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 Garovaglio will offset losses from the drop in Garovaglio's long position.| Central Puerto vs. American Express Co | Central Puerto vs. United States Steel | Central Puerto vs. Capex SA | Central Puerto vs. Pfizer Inc |
| Garovaglio vs. Transportadora de Gas | Garovaglio vs. Harmony Gold Mining | Garovaglio vs. Compania de Transporte | Garovaglio vs. Agrometal SAI |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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