Correlation Between Fondo Mutuo and Ingevec

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Can any of the company-specific risk be diversified away by investing in both Fondo Mutuo and Ingevec 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 Fondo Mutuo and Ingevec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fondo Mutuo ETF and Ingevec, you can compare the effects of market volatilities on Fondo Mutuo and Ingevec 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 Fondo Mutuo with a short position of Ingevec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fondo Mutuo and Ingevec.

Diversification Opportunities for Fondo Mutuo and Ingevec

FondoIngevecDiversified AwayFondoIngevecDiversified Away100%
0.59
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Fondo and Ingevec is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Fondo Mutuo ETF and Ingevec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingevec and Fondo Mutuo 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 Fondo Mutuo ETF are associated (or correlated) with Ingevec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingevec has no effect on the direction of Fondo Mutuo i.e., Fondo Mutuo and Ingevec go up and down completely randomly.

Pair Corralation between Fondo Mutuo and Ingevec

Assuming the 90 days trading horizon Fondo Mutuo is expected to generate 1.82 times less return on investment than Ingevec. But when comparing it to its historical volatility, Fondo Mutuo ETF is 2.07 times less risky than Ingevec. It trades about 0.05 of its potential returns per unit of risk. Ingevec is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  4,594  in Ingevec on September 20, 2024 and sell it today you would earn a total of  1,101  from holding Ingevec or generate 23.97% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy68.3%
ValuesDaily Returns

Fondo Mutuo ETF  vs.  Ingevec

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec 051015
JavaScript chart by amCharts 3.21.15CFMDIVO INGEVEC
       Timeline  
Fondo Mutuo ETF 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Fondo Mutuo ETF are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental indicators, Fondo Mutuo is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec1,3201,3401,3601,3801,400
Ingevec 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Ingevec are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Ingevec may actually be approaching a critical reversion point that can send shares even higher in January 2025.
JavaScript chart by amCharts 3.21.15SepOctNovDecOctNovDec5052545658

Fondo Mutuo and Ingevec Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-1.91-1.4-0.89-0.380.07840.571.081.592.1 0.20.40.60.81.0
JavaScript chart by amCharts 3.21.15CFMDIVO INGEVEC
       Returns  

Pair Trading with Fondo Mutuo and Ingevec

The main advantage of trading using opposite Fondo Mutuo and Ingevec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fondo Mutuo position performs unexpectedly, Ingevec 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 Ingevec will offset losses from the drop in Ingevec's long position.
The idea behind Fondo Mutuo ETF and Ingevec pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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