Correlation Between Mdica Sur and Grupo Televisa

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Can any of the company-specific risk be diversified away by investing in both Mdica Sur and Grupo Televisa 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 Mdica Sur and Grupo Televisa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mdica Sur SAB and Grupo Televisa SAB, you can compare the effects of market volatilities on Mdica Sur and Grupo Televisa 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 Mdica Sur with a short position of Grupo Televisa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mdica Sur and Grupo Televisa.

Diversification Opportunities for Mdica Sur and Grupo Televisa

-0.84
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Mdica and Grupo is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Mdica Sur SAB and Grupo Televisa SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Televisa SAB and Mdica Sur 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 Mdica Sur SAB are associated (or correlated) with Grupo Televisa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Televisa SAB has no effect on the direction of Mdica Sur i.e., Mdica Sur and Grupo Televisa go up and down completely randomly.

Pair Corralation between Mdica Sur and Grupo Televisa

Assuming the 90 days trading horizon Mdica Sur SAB is expected to generate 0.34 times more return on investment than Grupo Televisa. However, Mdica Sur SAB is 2.94 times less risky than Grupo Televisa. It trades about 0.15 of its potential returns per unit of risk. Grupo Televisa SAB is currently generating about -0.06 per unit of risk. If you would invest  2,899  in Mdica Sur SAB on August 24, 2024 and sell it today you would earn a total of  136.00  from holding Mdica Sur SAB or generate 4.69% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Mdica Sur SAB  vs.  Grupo Televisa SAB

 Performance 
       Timeline  
Mdica Sur SAB 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Mdica Sur SAB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.
Grupo Televisa SAB 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Grupo Televisa SAB are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Grupo Televisa may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Mdica Sur and Grupo Televisa Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Mdica Sur and Grupo Televisa

The main advantage of trading using opposite Mdica Sur and Grupo Televisa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mdica Sur position performs unexpectedly, Grupo Televisa 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 Televisa will offset losses from the drop in Grupo Televisa's long position.
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The idea behind Mdica Sur SAB and Grupo Televisa SAB pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Global Correlations module to find global opportunities by holding instruments from different markets.

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