Correlation Between Grupo Hotelero and Vitro SAB
Can any of the company-specific risk be diversified away by investing in both Grupo Hotelero and Vitro SAB 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 Hotelero and Vitro SAB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Hotelero Santa and Vitro SAB de, you can compare the effects of market volatilities on Grupo Hotelero and Vitro SAB 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 Hotelero with a short position of Vitro SAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Hotelero and Vitro SAB.
Diversification Opportunities for Grupo Hotelero and Vitro SAB
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Grupo and Vitro is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Hotelero Santa and Vitro SAB de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vitro SAB de and Grupo Hotelero 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 Hotelero Santa are associated (or correlated) with Vitro SAB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vitro SAB de has no effect on the direction of Grupo Hotelero i.e., Grupo Hotelero and Vitro SAB go up and down completely randomly.
Pair Corralation between Grupo Hotelero and Vitro SAB
Assuming the 90 days trading horizon Grupo Hotelero Santa is expected to generate 1.46 times more return on investment than Vitro SAB. However, Grupo Hotelero is 1.46 times more volatile than Vitro SAB de. It trades about 0.03 of its potential returns per unit of risk. Vitro SAB de is currently generating about -0.05 per unit of risk. If you would invest 369.00 in Grupo Hotelero Santa on September 12, 2024 and sell it today you would earn a total of 11.00 from holding Grupo Hotelero Santa or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Grupo Hotelero Santa vs. Vitro SAB de
Performance |
| Timeline |
| Grupo Hotelero Santa |
| Vitro SAB de |
Grupo Hotelero and Vitro SAB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Hotelero and Vitro SAB
The main advantage of trading using opposite Grupo Hotelero and Vitro SAB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Hotelero position performs unexpectedly, Vitro SAB 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 Vitro SAB will offset losses from the drop in Vitro SAB's long position.| Grupo Hotelero vs. Costco Wholesale | Grupo Hotelero vs. Martin Marietta Materials | Grupo Hotelero vs. First Majestic Silver | Grupo Hotelero vs. Verizon Communications |
| Vitro SAB vs. Grupo Sports World | Vitro SAB vs. GMxico Transportes SAB | Vitro SAB vs. McEwen Mining | Vitro SAB 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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