Correlation Between NIKE and Grupo Concesionario
Can any of the company-specific risk be diversified away by investing in both NIKE and Grupo Concesionario 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 NIKE and Grupo Concesionario into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NIKE Inc and Grupo Concesionario del, you can compare the effects of market volatilities on NIKE and Grupo Concesionario 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 NIKE with a short position of Grupo Concesionario. Check out your portfolio center. Please also check ongoing floating volatility patterns of NIKE and Grupo Concesionario.
Diversification Opportunities for NIKE and Grupo Concesionario
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NIKE and Grupo is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding NIKE Inc and Grupo Concesionario del in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Concesionario del and NIKE 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 NIKE Inc are associated (or correlated) with Grupo Concesionario. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Concesionario del has no effect on the direction of NIKE i.e., NIKE and Grupo Concesionario go up and down completely randomly.
Pair Corralation between NIKE and Grupo Concesionario
Assuming the 90 days trading horizon NIKE Inc is expected to generate 0.75 times more return on investment than Grupo Concesionario. However, NIKE Inc is 1.33 times less risky than Grupo Concesionario. It trades about 0.23 of its potential returns per unit of risk. Grupo Concesionario del is currently generating about 0.06 per unit of risk. If you would invest 688,000 in NIKE Inc on September 19, 2024 and sell it today you would earn a total of 62,000 from holding NIKE Inc or generate 9.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NIKE Inc vs. Grupo Concesionario del
Performance |
| Timeline |
| NIKE Inc |
| Grupo Concesionario del |
NIKE and Grupo Concesionario Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NIKE and Grupo Concesionario
The main advantage of trading using opposite NIKE and Grupo Concesionario positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NIKE position performs unexpectedly, Grupo Concesionario 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 Concesionario will offset losses from the drop in Grupo Concesionario's long position.| NIKE vs. Compania de Transporte | NIKE vs. Transportadora de Gas | NIKE vs. Harmony Gold Mining | NIKE vs. Agrometal SAI |
| Grupo Concesionario vs. Agrometal SAI | Grupo Concesionario vs. Compania de Transporte | Grupo Concesionario vs. Transportadora de Gas | Grupo Concesionario 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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