Correlation Between Grupo Carso and Halma PLC
Can any of the company-specific risk be diversified away by investing in both Grupo Carso and Halma PLC 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 Carso and Halma PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Carso SAB and Halma PLC, you can compare the effects of market volatilities on Grupo Carso and Halma PLC 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 Carso with a short position of Halma PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Carso and Halma PLC.
Diversification Opportunities for Grupo Carso and Halma PLC
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Grupo and Halma is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Carso SAB and Halma PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Halma PLC and Grupo Carso 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 Carso SAB are associated (or correlated) with Halma PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Halma PLC has no effect on the direction of Grupo Carso i.e., Grupo Carso and Halma PLC go up and down completely randomly.
Pair Corralation between Grupo Carso and Halma PLC
Assuming the 90 days horizon Grupo Carso SAB is expected to under-perform the Halma PLC. In addition to that, Grupo Carso is 1.32 times more volatile than Halma PLC. It trades about -0.22 of its total potential returns per unit of risk. Halma PLC is currently generating about 0.18 per unit of volatility. If you would invest 6,451 in Halma PLC on September 3, 2024 and sell it today you would earn a total of 578.00 from holding Halma PLC or generate 8.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Grupo Carso SAB vs. Halma PLC
Performance |
| Timeline |
| Grupo Carso SAB |
| Halma PLC |
Grupo Carso and Halma PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Carso and Halma PLC
The main advantage of trading using opposite Grupo Carso and Halma PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Carso position performs unexpectedly, Halma PLC 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 Halma PLC will offset losses from the drop in Halma PLC's long position.| Grupo Carso vs. Grupo Bimbo SAB | Grupo Carso vs. Grupo Financiero Inbursa | Grupo Carso vs. Becle SA de | Grupo Carso vs. HUMANA INC |
| Halma PLC vs. Grupo Bimbo SAB | Halma PLC vs. Grupo Financiero Inbursa | Halma PLC vs. Becle SA de | Halma PLC vs. HUMANA INC |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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