Correlation Between SP Merval and Ferrum SA
Can any of the company-specific risk be diversified away by investing in both SP Merval and Ferrum 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 SP Merval and Ferrum SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SP Merval and Ferrum SA, you can compare the effects of market volatilities on SP Merval and Ferrum 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 SP Merval with a short position of Ferrum SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of SP Merval and Ferrum SA.
Diversification Opportunities for SP Merval and Ferrum SA
Pay attention - limited upside
The 3 months correlation between MERV and Ferrum is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SP Merval and Ferrum SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ferrum SA and SP Merval 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 SP Merval are associated (or correlated) with Ferrum SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ferrum SA has no effect on the direction of SP Merval i.e., SP Merval and Ferrum SA go up and down completely randomly.
Pair Corralation between SP Merval and Ferrum SA
If you would invest 4,100 in Ferrum SA on October 24, 2024 and sell it today you would earn a total of 145.00 from holding Ferrum SA or generate 3.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
SP Merval vs. Ferrum SA
Performance |
| Timeline |
SP Merval and Ferrum SA Volatility Contrast
Predicted Return Density |
| Returns |
SP Merval
Pair trading matchups for SP Merval
Ferrum SA
Pair trading matchups for Ferrum SA
Pair Trading with SP Merval and Ferrum SA
The main advantage of trading using opposite SP Merval and Ferrum SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SP Merval position performs unexpectedly, Ferrum 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 Ferrum SA will offset losses from the drop in Ferrum SA's long position.| SP Merval vs. Transportadora de Gas | SP Merval vs. Agrometal SAI | SP Merval vs. Telecom Argentina | SP Merval vs. Harmony Gold Mining |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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