Correlation Between Grupo Mxico and Grupo Minsa

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Can any of the company-specific risk be diversified away by investing in both Grupo Mxico and Grupo Minsa 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 Grupo Mxico and Grupo Minsa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Mxico SAB and Grupo Minsa SAB, you can compare the effects of market volatilities on Grupo Mxico and Grupo Minsa 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 Grupo Mxico with a short position of Grupo Minsa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Mxico and Grupo Minsa.

Diversification Opportunities for Grupo Mxico and Grupo Minsa

0.22
  Correlation Coefficient

Modest diversification

The 3 months correlation between Grupo and Grupo is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Mxico SAB and Grupo Minsa SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Minsa SAB and Grupo Mxico 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 Grupo Mxico SAB are associated (or correlated) with Grupo Minsa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Minsa SAB has no effect on the direction of Grupo Mxico i.e., Grupo Mxico and Grupo Minsa go up and down completely randomly.

Pair Corralation between Grupo Mxico and Grupo Minsa

Assuming the 90 days trading horizon Grupo Mxico SAB is expected to under-perform the Grupo Minsa. In addition to that, Grupo Mxico is 6.34 times more volatile than Grupo Minsa SAB. It trades about -0.19 of its total potential returns per unit of risk. Grupo Minsa SAB is currently generating about 0.26 per unit of volatility. If you would invest  880.00  in Grupo Minsa SAB on August 24, 2024 and sell it today you would earn a total of  12.00  from holding Grupo Minsa SAB or generate 1.36% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy95.45%
ValuesDaily Returns

Grupo Mxico SAB  vs.  Grupo Minsa SAB

 Performance 
       Timeline  
Grupo Mxico SAB 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Grupo Mxico SAB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, Grupo Mxico is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.
Grupo Minsa SAB 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Grupo Minsa SAB are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Grupo Minsa is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Grupo Mxico and Grupo Minsa Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Grupo Mxico and Grupo Minsa

The main advantage of trading using opposite Grupo Mxico and Grupo Minsa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Mxico position performs unexpectedly, Grupo Minsa 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 Grupo Minsa will offset losses from the drop in Grupo Minsa's long position.
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Grupo Mxico vs. Fomento Econmico Mexicano
The idea behind Grupo Mxico SAB and Grupo Minsa SAB pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
Grupo Minsa vs. Alfa SAB de
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Grupo Minsa 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

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