Correlation Between GMxico Transportes and FedEx
Can any of the company-specific risk be diversified away by investing in both GMxico Transportes and FedEx 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 GMxico Transportes and FedEx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GMxico Transportes SAB and FedEx, you can compare the effects of market volatilities on GMxico Transportes and FedEx 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 GMxico Transportes with a short position of FedEx. Check out your portfolio center. Please also check ongoing floating volatility patterns of GMxico Transportes and FedEx.
Diversification Opportunities for GMxico Transportes and FedEx
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GMxico and FedEx is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding GMxico Transportes SAB and FedEx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FedEx and GMxico Transportes 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 GMxico Transportes SAB are associated (or correlated) with FedEx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FedEx has no effect on the direction of GMxico Transportes i.e., GMxico Transportes and FedEx go up and down completely randomly.
Pair Corralation between GMxico Transportes and FedEx
Assuming the 90 days trading horizon GMxico Transportes SAB is expected to under-perform the FedEx. But the stock apears to be less risky and, when comparing its historical volatility, GMxico Transportes SAB is 1.26 times less risky than FedEx. The stock trades about -0.01 of its potential returns per unit of risk. The FedEx is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 453,351 in FedEx on September 4, 2024 and sell it today you would earn a total of 153,279 from holding FedEx or generate 33.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GMxico Transportes SAB vs. FedEx
Performance |
| Timeline |
| GMxico Transportes SAB |
| FedEx |
GMxico Transportes and FedEx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GMxico Transportes and FedEx
The main advantage of trading using opposite GMxico Transportes and FedEx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GMxico Transportes position performs unexpectedly, FedEx 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 FedEx will offset losses from the drop in FedEx's long position.| GMxico Transportes vs. Grupo Mxico SAB | GMxico Transportes vs. The Select Sector | GMxico Transportes vs. Promotora y Operadora | GMxico Transportes vs. SPDR Series Trust |
| FedEx vs. McEwen Mining | FedEx vs. Cognizant Technology Solutions | FedEx vs. Ameriprise Financial | FedEx vs. Grupo Hotelero Santa |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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