Correlation Between Energia Latina and Soquicom
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By analyzing existing cross correlation between Energia Latina SA and Soquicom, you can compare the effects of market volatilities on Energia Latina and Soquicom 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 Energia Latina with a short position of Soquicom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energia Latina and Soquicom.
Diversification Opportunities for Energia Latina and Soquicom
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Energia and Soquicom is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Energia Latina SA and Soquicom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soquicom and Energia Latina 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 Energia Latina SA are associated (or correlated) with Soquicom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soquicom has no effect on the direction of Energia Latina i.e., Energia Latina and Soquicom go up and down completely randomly.
Pair Corralation between Energia Latina and Soquicom
Assuming the 90 days trading horizon Energia Latina SA is expected to generate 0.59 times more return on investment than Soquicom. However, Energia Latina SA is 1.7 times less risky than Soquicom. It trades about 0.13 of its potential returns per unit of risk. Soquicom is currently generating about -0.07 per unit of risk. If you would invest 90,000 in Energia Latina SA on August 28, 2024 and sell it today you would earn a total of 3,500 from holding Energia Latina SA or generate 3.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.31% |
| Values | Daily Returns |
Energia Latina SA vs. Soquicom
Performance |
| Timeline |
| Energia Latina SA |
| Soquicom |
Energia Latina and Soquicom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energia Latina and Soquicom
The main advantage of trading using opposite Energia Latina and Soquicom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energia Latina position performs unexpectedly, Soquicom 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 Soquicom will offset losses from the drop in Soquicom's long position.| Energia Latina vs. Salfacorp | Energia Latina vs. Vina Concha To | Energia Latina vs. Sociedad Matriz SAAM | Energia Latina vs. Nitratos de Chile |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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