Correlation Between IRSA Inversiones and Metrogas
Can any of the company-specific risk be diversified away by investing in both IRSA Inversiones and Metrogas 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 IRSA Inversiones and Metrogas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IRSA Inversiones y and Metrogas SA, you can compare the effects of market volatilities on IRSA Inversiones and Metrogas 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 IRSA Inversiones with a short position of Metrogas. Check out your portfolio center. Please also check ongoing floating volatility patterns of IRSA Inversiones and Metrogas.
Diversification Opportunities for IRSA Inversiones and Metrogas
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between IRSA and Metrogas is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding IRSA Inversiones y and Metrogas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metrogas SA and IRSA Inversiones 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 IRSA Inversiones y are associated (or correlated) with Metrogas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metrogas SA has no effect on the direction of IRSA Inversiones i.e., IRSA Inversiones and Metrogas go up and down completely randomly.
Pair Corralation between IRSA Inversiones and Metrogas
Assuming the 90 days trading horizon IRSA Inversiones y is expected to generate 0.62 times more return on investment than Metrogas. However, IRSA Inversiones y is 1.61 times less risky than Metrogas. It trades about -0.01 of its potential returns per unit of risk. Metrogas SA is currently generating about -0.17 per unit of risk. If you would invest 177,000 in IRSA Inversiones y on October 20, 2024 and sell it today you would lose (1,500) from holding IRSA Inversiones y or give up 0.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
IRSA Inversiones y vs. Metrogas SA
Performance |
| Timeline |
| IRSA Inversiones y |
| Metrogas SA |
IRSA Inversiones and Metrogas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IRSA Inversiones and Metrogas
The main advantage of trading using opposite IRSA Inversiones and Metrogas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IRSA Inversiones position performs unexpectedly, Metrogas 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 Metrogas will offset losses from the drop in Metrogas' long position.| IRSA Inversiones vs. Compania de Transporte | IRSA Inversiones vs. Transportadora de Gas | IRSA Inversiones vs. Telecom Argentina | IRSA Inversiones vs. Harmony Gold Mining |
| Metrogas vs. Compania de Transporte | Metrogas vs. Ledesma SAAI | Metrogas vs. American Express Co | Metrogas vs. Telecom Argentina |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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