Correlation Between Grupo Nacional and Advanced Micro
Can any of the company-specific risk be diversified away by investing in both Grupo Nacional and Advanced Micro 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 Nacional and Advanced Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Nacional Provincial and Advanced Micro Devices, you can compare the effects of market volatilities on Grupo Nacional and Advanced Micro 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 Nacional with a short position of Advanced Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Nacional and Advanced Micro.
Diversification Opportunities for Grupo Nacional and Advanced Micro
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Grupo and Advanced is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Nacional Provincial and Advanced Micro Devices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Micro Devices and Grupo Nacional 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 Nacional Provincial are associated (or correlated) with Advanced Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Micro Devices has no effect on the direction of Grupo Nacional i.e., Grupo Nacional and Advanced Micro go up and down completely randomly.
Pair Corralation between Grupo Nacional and Advanced Micro
Assuming the 90 days trading horizon Grupo Nacional Provincial is expected to under-perform the Advanced Micro. But the stock apears to be less risky and, when comparing its historical volatility, Grupo Nacional Provincial is 2.54 times less risky than Advanced Micro. The stock trades about -0.04 of its potential returns per unit of risk. The Advanced Micro Devices is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 210,288 in Advanced Micro Devices on August 31, 2024 and sell it today you would earn a total of 71,412 from holding Advanced Micro Devices or generate 33.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Nacional Provincial vs. Advanced Micro Devices
Performance |
| Timeline |
| Grupo Nacional Provincial |
| Advanced Micro Devices |
Grupo Nacional and Advanced Micro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Nacional and Advanced Micro
The main advantage of trading using opposite Grupo Nacional and Advanced Micro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Nacional position performs unexpectedly, Advanced Micro 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 Advanced Micro will offset losses from the drop in Advanced Micro's long position.| Grupo Nacional vs. Grupo Financiero Inbursa | Grupo Nacional vs. Promotora y Operadora | Grupo Nacional vs. ALPEK SAB de | Grupo Nacional vs. Grupo Financiero Banorte |
| Advanced Micro vs. NVIDIA | Advanced Micro vs. Texas Instruments Incorporated | Advanced Micro vs. Intel | Advanced Micro vs. Micron Technology |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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