Correlation Between Inversora Juramento and San Miguel
Can any of the company-specific risk be diversified away by investing in both Inversora Juramento and San Miguel 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 Inversora Juramento and San Miguel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inversora Juramento SA and San Miguel AG, you can compare the effects of market volatilities on Inversora Juramento and San Miguel 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 Inversora Juramento with a short position of San Miguel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inversora Juramento and San Miguel.
Diversification Opportunities for Inversora Juramento and San Miguel
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Inversora and San is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Inversora Juramento SA and San Miguel AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on San Miguel AG and Inversora Juramento 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 Inversora Juramento SA are associated (or correlated) with San Miguel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of San Miguel AG has no effect on the direction of Inversora Juramento i.e., Inversora Juramento and San Miguel go up and down completely randomly.
Pair Corralation between Inversora Juramento and San Miguel
Assuming the 90 days trading horizon Inversora Juramento SA is expected to generate 0.83 times more return on investment than San Miguel. However, Inversora Juramento SA is 1.21 times less risky than San Miguel. It trades about -0.12 of its potential returns per unit of risk. San Miguel AG is currently generating about -0.24 per unit of risk. If you would invest 43,650 in Inversora Juramento SA on October 20, 2024 and sell it today you would lose (2,750) from holding Inversora Juramento SA or give up 6.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inversora Juramento SA vs. San Miguel AG
Performance |
| Timeline |
| Inversora Juramento |
| San Miguel AG |
Inversora Juramento and San Miguel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inversora Juramento and San Miguel
The main advantage of trading using opposite Inversora Juramento and San Miguel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inversora Juramento position performs unexpectedly, San Miguel 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 San Miguel will offset losses from the drop in San Miguel's long position.| Inversora Juramento vs. Molinos Agro SA | Inversora Juramento vs. Cresud SA | Inversora Juramento vs. San Miguel AG | Inversora Juramento vs. Ledesma SAAI |
| San Miguel vs. Molinos Agro SA | San Miguel vs. Cresud SA | San Miguel vs. Ledesma SAAI | San Miguel vs. Inversora Juramento SA |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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