Correlation Between GMxico Transportes and Grupo Hotelero
Can any of the company-specific risk be diversified away by investing in both GMxico Transportes and Grupo Hotelero 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 Grupo Hotelero 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 Grupo Hotelero Santa, you can compare the effects of market volatilities on GMxico Transportes and Grupo Hotelero 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 Grupo Hotelero. Check out your portfolio center. Please also check ongoing floating volatility patterns of GMxico Transportes and Grupo Hotelero.
Diversification Opportunities for GMxico Transportes and Grupo Hotelero
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between GMxico and Grupo is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding GMxico Transportes SAB and Grupo Hotelero Santa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Hotelero Santa 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 Grupo Hotelero. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Hotelero Santa has no effect on the direction of GMxico Transportes i.e., GMxico Transportes and Grupo Hotelero go up and down completely randomly.
Pair Corralation between GMxico Transportes and Grupo Hotelero
Assuming the 90 days trading horizon GMxico Transportes SAB is expected to under-perform the Grupo Hotelero. But the stock apears to be less risky and, when comparing its historical volatility, GMxico Transportes SAB is 1.22 times less risky than Grupo Hotelero. The stock trades about -0.11 of its potential returns per unit of risk. The Grupo Hotelero Santa is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 390.00 in Grupo Hotelero Santa on October 25, 2024 and sell it today you would lose (2.00) from holding Grupo Hotelero Santa or give up 0.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GMxico Transportes SAB vs. Grupo Hotelero Santa
Performance |
| Timeline |
| GMxico Transportes SAB |
| Grupo Hotelero Santa |
GMxico Transportes and Grupo Hotelero Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GMxico Transportes and Grupo Hotelero
The main advantage of trading using opposite GMxico Transportes and Grupo Hotelero positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GMxico Transportes position performs unexpectedly, Grupo Hotelero 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 Hotelero will offset losses from the drop in Grupo Hotelero's long position.| GMxico Transportes vs. Monster Beverage Corp | GMxico Transportes vs. KB Home | GMxico Transportes vs. Taiwan Semiconductor Manufacturing | GMxico Transportes vs. Martin Marietta Materials |
| Grupo Hotelero vs. FIBRA Storage | Grupo Hotelero vs. Grupo Sports World | Grupo Hotelero vs. Samsung Electronics Co | Grupo Hotelero vs. GMxico Transportes 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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