Correlation Between Central Puerto and Grupo Supervielle
Can any of the company-specific risk be diversified away by investing in both Central Puerto and Grupo Supervielle 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 Grupo Supervielle 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 Grupo Supervielle SA, you can compare the effects of market volatilities on Central Puerto and Grupo Supervielle 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 Grupo Supervielle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Puerto and Grupo Supervielle.
Diversification Opportunities for Central Puerto and Grupo Supervielle
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Central and Grupo is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Central Puerto SA and Grupo Supervielle SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Supervielle 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 Grupo Supervielle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Supervielle has no effect on the direction of Central Puerto i.e., Central Puerto and Grupo Supervielle go up and down completely randomly.
Pair Corralation between Central Puerto and Grupo Supervielle
Assuming the 90 days trading horizon Central Puerto SA is expected to under-perform the Grupo Supervielle. But the stock apears to be less risky and, when comparing its historical volatility, Central Puerto SA is 1.42 times less risky than Grupo Supervielle. The stock trades about -0.03 of its potential returns per unit of risk. The Grupo Supervielle SA is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 341,000 in Grupo Supervielle SA on October 20, 2024 and sell it today you would earn a total of 59,000 from holding Grupo Supervielle SA or generate 17.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.0% |
| Values | Daily Returns |
Central Puerto SA vs. Grupo Supervielle SA
Performance |
| Timeline |
| Central Puerto SA |
| Grupo Supervielle |
Central Puerto and Grupo Supervielle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Puerto and Grupo Supervielle
The main advantage of trading using opposite Central Puerto and Grupo Supervielle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Puerto position performs unexpectedly, Grupo Supervielle 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 Grupo Supervielle will offset losses from the drop in Grupo Supervielle's long position.| Central Puerto vs. Enel Generacion Costanera | Central Puerto vs. Edesa Holding SA | Central Puerto vs. Empresa Distribuidora Electrica |
| Grupo Supervielle vs. Transportadora de Gas | Grupo Supervielle vs. Harmony Gold Mining | Grupo Supervielle vs. Compania de Transporte | Grupo Supervielle vs. United States Steel |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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