Correlation Between Fomento Econmico and Gruma SAB
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By analyzing existing cross correlation between Fomento Econmico Mexicano and Gruma SAB de, you can compare the effects of market volatilities on Fomento Econmico and Gruma SAB 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 Fomento Econmico with a short position of Gruma SAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fomento Econmico and Gruma SAB.
Diversification Opportunities for Fomento Econmico and Gruma SAB
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fomento and Gruma is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Fomento Econmico Mexicano and Gruma SAB de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gruma SAB de and Fomento Econmico 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 Fomento Econmico Mexicano are associated (or correlated) with Gruma SAB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gruma SAB de has no effect on the direction of Fomento Econmico i.e., Fomento Econmico and Gruma SAB go up and down completely randomly.
Pair Corralation between Fomento Econmico and Gruma SAB
Assuming the 90 days trading horizon Fomento Econmico is expected to generate 1.18 times less return on investment than Gruma SAB. In addition to that, Fomento Econmico is 1.1 times more volatile than Gruma SAB de. It trades about 0.26 of its total potential returns per unit of risk. Gruma SAB de is currently generating about 0.33 per unit of volatility. If you would invest 32,295 in Gruma SAB de on November 18, 2024 and sell it today you would earn a total of 3,208 from holding Gruma SAB de or generate 9.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fomento Econmico Mexicano vs. Gruma SAB de
Performance |
| Timeline |
| Fomento Econmico Mexicano |
| Gruma SAB de |
Fomento Econmico and Gruma SAB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fomento Econmico and Gruma SAB
The main advantage of trading using opposite Fomento Econmico and Gruma SAB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fomento Econmico position performs unexpectedly, Gruma SAB 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 Gruma SAB will offset losses from the drop in Gruma SAB's long position.| Fomento Econmico vs. Grupo Financiero Banorte | Fomento Econmico vs. Alfa SAB de | Fomento Econmico vs. Grupo Mxico SAB | Fomento Econmico vs. CEMEX SAB de |
| Gruma SAB vs. Alfa SAB de | Gruma SAB vs. Grupo Financiero Banorte | Gruma SAB vs. Fomento Econmico Mexicano | Gruma SAB vs. Grupo Mxico SAB |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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