Correlation Between Look Holdings and GRUPO CARSO-A1
Can any of the company-specific risk be diversified away by investing in both Look Holdings and GRUPO CARSO-A1 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 Look Holdings and GRUPO CARSO-A1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Look Holdings and GRUPO CARSO A1, you can compare the effects of market volatilities on Look Holdings and GRUPO CARSO-A1 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 Look Holdings with a short position of GRUPO CARSO-A1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Look Holdings and GRUPO CARSO-A1.
Diversification Opportunities for Look Holdings and GRUPO CARSO-A1
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Look and GRUPO is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Look Holdings and GRUPO CARSO A1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRUPO CARSO A1 and Look Holdings 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 Look Holdings are associated (or correlated) with GRUPO CARSO-A1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRUPO CARSO A1 has no effect on the direction of Look Holdings i.e., Look Holdings and GRUPO CARSO-A1 go up and down completely randomly.
Pair Corralation between Look Holdings and GRUPO CARSO-A1
Assuming the 90 days trading horizon Look Holdings is expected to under-perform the GRUPO CARSO-A1. But the stock apears to be less risky and, when comparing its historical volatility, Look Holdings is 2.63 times less risky than GRUPO CARSO-A1. The stock trades about 0.0 of its potential returns per unit of risk. The GRUPO CARSO A1 is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 187.00 in GRUPO CARSO A1 on September 5, 2024 and sell it today you would earn a total of 398.00 from holding GRUPO CARSO A1 or generate 212.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Look Holdings vs. GRUPO CARSO A1
Performance |
| Timeline |
| Look Holdings |
| GRUPO CARSO A1 |
Look Holdings and GRUPO CARSO-A1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Look Holdings and GRUPO CARSO-A1
The main advantage of trading using opposite Look Holdings and GRUPO CARSO-A1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Look Holdings position performs unexpectedly, GRUPO CARSO-A1 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 CARSO-A1 will offset losses from the drop in GRUPO CARSO-A1's long position.| Look Holdings vs. GRUPO CARSO A1 | Look Holdings vs. INTER CARS SA | Look Holdings vs. Chesapeake Utilities | Look Holdings vs. Geely Automobile Holdings |
| GRUPO CARSO-A1 vs. The Hanover Insurance | GRUPO CARSO-A1 vs. Sterling Construction | GRUPO CARSO-A1 vs. QBE Insurance Group | GRUPO CARSO-A1 vs. Tencent Music Entertainment |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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