Correlation Between Costco Wholesale and Promotora
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By analyzing existing cross correlation between Costco Wholesale and Promotora y Operadora, you can compare the effects of market volatilities on Costco Wholesale and Promotora 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 Costco Wholesale with a short position of Promotora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Costco Wholesale and Promotora.
Diversification Opportunities for Costco Wholesale and Promotora
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Costco and Promotora is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Costco Wholesale and Promotora y Operadora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Promotora y Operadora and Costco Wholesale 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 Costco Wholesale are associated (or correlated) with Promotora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Promotora y Operadora has no effect on the direction of Costco Wholesale i.e., Costco Wholesale and Promotora go up and down completely randomly.
Pair Corralation between Costco Wholesale and Promotora
Assuming the 90 days trading horizon Costco Wholesale is expected to generate 0.87 times more return on investment than Promotora. However, Costco Wholesale is 1.14 times less risky than Promotora. It trades about 0.13 of its potential returns per unit of risk. Promotora y Operadora is currently generating about 0.07 per unit of risk. If you would invest 864,890 in Costco Wholesale on September 14, 2024 and sell it today you would earn a total of 1,160,263 from holding Costco Wholesale or generate 134.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Costco Wholesale vs. Promotora y Operadora
Performance |
| Timeline |
| Costco Wholesale |
| Promotora y Operadora |
Costco Wholesale and Promotora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Costco Wholesale and Promotora
The main advantage of trading using opposite Costco Wholesale and Promotora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Costco Wholesale position performs unexpectedly, Promotora 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 Promotora will offset losses from the drop in Promotora's long position.| Costco Wholesale vs. DXC Technology | Costco Wholesale vs. GMxico Transportes SAB | Costco Wholesale vs. KB Home | Costco Wholesale vs. Applied Materials |
| Promotora vs. Verizon Communications | Promotora vs. Cognizant Technology Solutions | Promotora vs. GMxico Transportes SAB | Promotora vs. Costco Wholesale |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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