Correlation Between Compania General and Embotelladora Andina
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By analyzing existing cross correlation between Compania General de and Embotelladora Andina SA, you can compare the effects of market volatilities on Compania General and Embotelladora Andina 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 General with a short position of Embotelladora Andina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compania General and Embotelladora Andina.
Diversification Opportunities for Compania General and Embotelladora Andina
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Compania and Embotelladora is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Compania General de and Embotelladora Andina SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Embotelladora Andina and Compania General 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 General de are associated (or correlated) with Embotelladora Andina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Embotelladora Andina has no effect on the direction of Compania General i.e., Compania General and Embotelladora Andina go up and down completely randomly.
Pair Corralation between Compania General and Embotelladora Andina
Assuming the 90 days trading horizon Compania General de is expected to under-perform the Embotelladora Andina. In addition to that, Compania General is 1.03 times more volatile than Embotelladora Andina SA. It trades about -0.13 of its total potential returns per unit of risk. Embotelladora Andina SA is currently generating about -0.11 per unit of volatility. If you would invest 229,650 in Embotelladora Andina SA on August 28, 2024 and sell it today you would lose (14,100) from holding Embotelladora Andina SA or give up 6.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 85.0% |
| Values | Daily Returns |
Compania General de vs. Embotelladora Andina SA
Performance |
| Timeline |
| Compania General |
| Embotelladora Andina |
Compania General and Embotelladora Andina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compania General and Embotelladora Andina
The main advantage of trading using opposite Compania General and Embotelladora Andina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compania General position performs unexpectedly, Embotelladora Andina 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 Embotelladora Andina will offset losses from the drop in Embotelladora Andina's long position.| Compania General vs. Embotelladora Andina SA | Compania General vs. Administradora Americana de | Compania General vs. Las Condes | Compania General vs. Salfacorp |
| Embotelladora Andina vs. Administradora Americana de | Embotelladora Andina vs. Las Condes | Embotelladora Andina vs. Multiexport Foods SA | Embotelladora Andina vs. Energia Latina 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 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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