Correlation Between HAMMONIA Schiffsholding and Grupo Mxico
Can any of the company-specific risk be diversified away by investing in both HAMMONIA Schiffsholding and Grupo Mxico 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 HAMMONIA Schiffsholding and Grupo Mxico into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HAMMONIA Schiffsholding AG and Grupo Mxico SAB, you can compare the effects of market volatilities on HAMMONIA Schiffsholding and Grupo Mxico 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 HAMMONIA Schiffsholding with a short position of Grupo Mxico. Check out your portfolio center. Please also check ongoing floating volatility patterns of HAMMONIA Schiffsholding and Grupo Mxico.
Diversification Opportunities for HAMMONIA Schiffsholding and Grupo Mxico
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HAMMONIA and Grupo is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding HAMMONIA Schiffsholding AG and Grupo Mxico SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Mxico SAB and HAMMONIA Schiffsholding 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 HAMMONIA Schiffsholding AG are associated (or correlated) with Grupo Mxico. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Mxico SAB has no effect on the direction of HAMMONIA Schiffsholding i.e., HAMMONIA Schiffsholding and Grupo Mxico go up and down completely randomly.
Pair Corralation between HAMMONIA Schiffsholding and Grupo Mxico
Assuming the 90 days trading horizon HAMMONIA Schiffsholding AG is expected to under-perform the Grupo Mxico. But the stock apears to be less risky and, when comparing its historical volatility, HAMMONIA Schiffsholding AG is 1.98 times less risky than Grupo Mxico. The stock trades about -0.01 of its potential returns per unit of risk. The Grupo Mxico SAB is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 264.00 in Grupo Mxico SAB on September 24, 2024 and sell it today you would earn a total of 205.00 from holding Grupo Mxico SAB or generate 77.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HAMMONIA Schiffsholding AG vs. Grupo Mxico SAB
Performance |
| Timeline |
| HAMMONIA Schiffsholding |
| Grupo Mxico SAB |
HAMMONIA Schiffsholding and Grupo Mxico Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HAMMONIA Schiffsholding and Grupo Mxico
The main advantage of trading using opposite HAMMONIA Schiffsholding and Grupo Mxico positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HAMMONIA Schiffsholding position performs unexpectedly, Grupo Mxico 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 Mxico will offset losses from the drop in Grupo Mxico's long position.| HAMMONIA Schiffsholding vs. COSCO SHIPPING Holdings | HAMMONIA Schiffsholding vs. Nippon Yusen Kabushiki | HAMMONIA Schiffsholding vs. Hapag Lloyd AG | HAMMONIA Schiffsholding vs. Orient Overseas Limited |
| Grupo Mxico vs. BHP Group Limited | Grupo Mxico vs. BHP Group Limited | Grupo Mxico vs. Rio Tinto Group | Grupo Mxico vs. Rio Tinto Group |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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