Correlation Between Multiexport Foods and Vapores
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By analyzing existing cross correlation between Multiexport Foods SA and Vapores, you can compare the effects of market volatilities on Multiexport Foods and Vapores 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 Multiexport Foods with a short position of Vapores. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multiexport Foods and Vapores.
Diversification Opportunities for Multiexport Foods and Vapores
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Multiexport and Vapores is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Multiexport Foods SA and Vapores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vapores and Multiexport Foods 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 Multiexport Foods SA are associated (or correlated) with Vapores. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vapores has no effect on the direction of Multiexport Foods i.e., Multiexport Foods and Vapores go up and down completely randomly.
Pair Corralation between Multiexport Foods and Vapores
Assuming the 90 days trading horizon Multiexport Foods SA is expected to generate 0.48 times more return on investment than Vapores. However, Multiexport Foods SA is 2.09 times less risky than Vapores. It trades about 0.2 of its potential returns per unit of risk. Vapores is currently generating about -0.1 per unit of risk. If you would invest 19,100 in Multiexport Foods SA on August 28, 2024 and sell it today you would earn a total of 1,388 from holding Multiexport Foods SA or generate 7.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 66.1% |
| Values | Daily Returns |
Multiexport Foods SA vs. Vapores
Performance |
| Timeline |
| Multiexport Foods |
| Vapores |
Multiexport Foods and Vapores Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multiexport Foods and Vapores
The main advantage of trading using opposite Multiexport Foods and Vapores positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multiexport Foods position performs unexpectedly, Vapores 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 Vapores will offset losses from the drop in Vapores' long position.The idea behind Multiexport Foods SA and Vapores 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.| Vapores vs. Administradora Americana de | Vapores vs. Energia Latina SA | Vapores vs. Embotelladora Andina SA | Vapores vs. Multiexport Foods SA |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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