Correlation Between Home Depot and Grupo Lamosa
Can any of the company-specific risk be diversified away by investing in both Home Depot and Grupo Lamosa 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 Home Depot and Grupo Lamosa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Home Depot and Grupo Lamosa SAB, you can compare the effects of market volatilities on Home Depot and Grupo Lamosa 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 Home Depot with a short position of Grupo Lamosa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and Grupo Lamosa.
Diversification Opportunities for Home Depot and Grupo Lamosa
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Home and Grupo is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding The Home Depot and Grupo Lamosa SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Lamosa SAB and Home Depot 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 The Home Depot are associated (or correlated) with Grupo Lamosa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Lamosa SAB has no effect on the direction of Home Depot i.e., Home Depot and Grupo Lamosa go up and down completely randomly.
Pair Corralation between Home Depot and Grupo Lamosa
If you would invest 790,000 in The Home Depot on October 25, 2024 and sell it today you would earn a total of 50,475 from holding The Home Depot or generate 6.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Home Depot vs. Grupo Lamosa SAB
Performance |
| Timeline |
| Home Depot |
| Grupo Lamosa SAB |
Home Depot and Grupo Lamosa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Depot and Grupo Lamosa
The main advantage of trading using opposite Home Depot and Grupo Lamosa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Depot position performs unexpectedly, Grupo Lamosa 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 Lamosa will offset losses from the drop in Grupo Lamosa's long position.| Home Depot vs. Grupo Sports World | Home Depot vs. Taiwan Semiconductor Manufacturing | Home Depot vs. Verizon Communications | Home Depot vs. Grupo Carso SAB |
| Grupo Lamosa vs. Hoteles City Express | Grupo Lamosa vs. The Bank of | Grupo Lamosa vs. New Oriental Education | Grupo Lamosa vs. Grupo Carso 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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