Correlation Between Ledesma SAAI and Boldt SA
Can any of the company-specific risk be diversified away by investing in both Ledesma SAAI and Boldt SA 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 Ledesma SAAI and Boldt SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ledesma SAAI and Boldt SA, you can compare the effects of market volatilities on Ledesma SAAI and Boldt SA 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 Ledesma SAAI with a short position of Boldt SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ledesma SAAI and Boldt SA.
Diversification Opportunities for Ledesma SAAI and Boldt SA
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ledesma and Boldt is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Ledesma SAAI and Boldt SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boldt SA and Ledesma SAAI 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 Ledesma SAAI are associated (or correlated) with Boldt SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boldt SA has no effect on the direction of Ledesma SAAI i.e., Ledesma SAAI and Boldt SA go up and down completely randomly.
Pair Corralation between Ledesma SAAI and Boldt SA
Assuming the 90 days trading horizon Ledesma SAAI is expected to generate 0.7 times more return on investment than Boldt SA. However, Ledesma SAAI is 1.43 times less risky than Boldt SA. It trades about 0.14 of its potential returns per unit of risk. Boldt SA is currently generating about 0.09 per unit of risk. If you would invest 15,790 in Ledesma SAAI on November 29, 2024 and sell it today you would earn a total of 130,710 from holding Ledesma SAAI or generate 827.8% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Ledesma SAAI vs. Boldt SA
Performance |
Timeline |
Ledesma SAAI |
Boldt SA |
Ledesma SAAI and Boldt SA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ledesma SAAI and Boldt SA
The main advantage of trading using opposite Ledesma SAAI and Boldt SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ledesma SAAI position performs unexpectedly, Boldt SA 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 Boldt SA will offset losses from the drop in Boldt SA's long position.Ledesma SAAI vs. Compania de Transporte | ||
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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