Correlation Between Pampa Energia and Agrometal SAI
Can any of the company-specific risk be diversified away by investing in both Pampa Energia and Agrometal SAI 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 Pampa Energia and Agrometal SAI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pampa Energia SA and Agrometal SAI, you can compare the effects of market volatilities on Pampa Energia and Agrometal SAI 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 Pampa Energia with a short position of Agrometal SAI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pampa Energia and Agrometal SAI.
Diversification Opportunities for Pampa Energia and Agrometal SAI
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Pampa and Agrometal is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Pampa Energia SA and Agrometal SAI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agrometal SAI and Pampa Energia 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 Pampa Energia SA are associated (or correlated) with Agrometal SAI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agrometal SAI has no effect on the direction of Pampa Energia i.e., Pampa Energia and Agrometal SAI go up and down completely randomly.
Pair Corralation between Pampa Energia and Agrometal SAI
Assuming the 90 days trading horizon Pampa Energia SA is expected to generate 0.5 times more return on investment than Agrometal SAI. However, Pampa Energia SA is 1.98 times less risky than Agrometal SAI. It trades about 0.18 of its potential returns per unit of risk. Agrometal SAI is currently generating about 0.03 per unit of risk. If you would invest 373,000 in Pampa Energia SA on September 23, 2024 and sell it today you would earn a total of 31,000 from holding Pampa Energia SA or generate 8.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pampa Energia SA vs. Agrometal SAI
Performance |
| Timeline |
| Pampa Energia SA |
| Agrometal SAI |
Pampa Energia and Agrometal SAI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pampa Energia and Agrometal SAI
The main advantage of trading using opposite Pampa Energia and Agrometal SAI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pampa Energia position performs unexpectedly, Agrometal SAI 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 Agrometal SAI will offset losses from the drop in Agrometal SAI's long position.| Pampa Energia vs. Compania de Transporte | Pampa Energia vs. Carboclor | Pampa Energia vs. BBVA Banco Frances | Pampa Energia vs. Agrometal SAI |
| Agrometal SAI vs. Pampa Energia SA | Agrometal SAI vs. YPF SA D | Agrometal SAI vs. Capex SA | Agrometal SAI vs. Fiplasto 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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