Correlation Between Grupo Bimbo and CK Hutchison
Can any of the company-specific risk be diversified away by investing in both Grupo Bimbo and CK Hutchison 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 Bimbo and CK Hutchison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Bimbo SAB and CK Hutchison Holdings, you can compare the effects of market volatilities on Grupo Bimbo and CK Hutchison 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 Bimbo with a short position of CK Hutchison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Bimbo and CK Hutchison.
Diversification Opportunities for Grupo Bimbo and CK Hutchison
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grupo and CKHUF is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Bimbo SAB and CK Hutchison Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CK Hutchison Holdings and Grupo Bimbo 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 Bimbo SAB are associated (or correlated) with CK Hutchison. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CK Hutchison Holdings has no effect on the direction of Grupo Bimbo i.e., Grupo Bimbo and CK Hutchison go up and down completely randomly.
Pair Corralation between Grupo Bimbo and CK Hutchison
Assuming the 90 days horizon Grupo Bimbo SAB is expected to generate 1.35 times more return on investment than CK Hutchison. However, Grupo Bimbo is 1.35 times more volatile than CK Hutchison Holdings. It trades about 0.12 of its potential returns per unit of risk. CK Hutchison Holdings is currently generating about 0.01 per unit of risk. If you would invest 287.00 in Grupo Bimbo SAB on September 4, 2024 and sell it today you would earn a total of 25.00 from holding Grupo Bimbo SAB or generate 8.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Grupo Bimbo SAB vs. CK Hutchison Holdings
Performance |
| Timeline |
| Grupo Bimbo SAB |
| CK Hutchison Holdings |
Grupo Bimbo and CK Hutchison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Bimbo and CK Hutchison
The main advantage of trading using opposite Grupo Bimbo and CK Hutchison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Bimbo position performs unexpectedly, CK Hutchison 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 CK Hutchison will offset losses from the drop in CK Hutchison's long position.| Grupo Bimbo vs. Kellanova | Grupo Bimbo vs. Lancaster Colony | Grupo Bimbo vs. The A2 Milk | Grupo Bimbo vs. Artisan Consumer Goods |
| CK Hutchison vs. Grupo Bimbo SAB | CK Hutchison vs. Grupo Financiero Inbursa | CK Hutchison vs. Becle SA de | CK Hutchison 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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