Correlation Between FibraHotel and Financiera Independencia
Can any of the company-specific risk be diversified away by investing in both FibraHotel and Financiera Independencia 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 FibraHotel and Financiera Independencia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FibraHotel and Financiera Independencia SAB, you can compare the effects of market volatilities on FibraHotel and Financiera Independencia 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 FibraHotel with a short position of Financiera Independencia. Check out your portfolio center. Please also check ongoing floating volatility patterns of FibraHotel and Financiera Independencia.
Diversification Opportunities for FibraHotel and Financiera Independencia
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FibraHotel and Financiera is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding FibraHotel and Financiera Independencia SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Financiera Independencia and FibraHotel 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 FibraHotel are associated (or correlated) with Financiera Independencia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Financiera Independencia has no effect on the direction of FibraHotel i.e., FibraHotel and Financiera Independencia go up and down completely randomly.
Pair Corralation between FibraHotel and Financiera Independencia
Assuming the 90 days trading horizon FibraHotel is expected to under-perform the Financiera Independencia. In addition to that, FibraHotel is 1.6 times more volatile than Financiera Independencia SAB. It trades about -0.02 of its total potential returns per unit of risk. Financiera Independencia SAB is currently generating about 0.01 per unit of volatility. If you would invest 800.00 in Financiera Independencia SAB on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Financiera Independencia SAB or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FibraHotel vs. Financiera Independencia SAB
Performance |
| Timeline |
| FibraHotel |
| Financiera Independencia |
FibraHotel and Financiera Independencia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FibraHotel and Financiera Independencia
The main advantage of trading using opposite FibraHotel and Financiera Independencia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FibraHotel position performs unexpectedly, Financiera Independencia 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 Financiera Independencia will offset losses from the drop in Financiera Independencia's long position.| FibraHotel vs. Sony Group | FibraHotel vs. Barclays PLC | FibraHotel vs. HSBC Holdings plc | FibraHotel vs. Taiwan Semiconductor Manufacturing |
| Financiera Independencia vs. Taiwan Semiconductor Manufacturing | Financiera Independencia vs. United Airlines Holdings | Financiera Independencia vs. FibraHotel | Financiera Independencia vs. Ross Stores |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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