Correlation Between Promotora and FibraHotel
Can any of the company-specific risk be diversified away by investing in both Promotora and FibraHotel 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 Promotora and FibraHotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Promotora y Operadora and FibraHotel, you can compare the effects of market volatilities on Promotora and FibraHotel 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 Promotora with a short position of FibraHotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Promotora and FibraHotel.
Diversification Opportunities for Promotora and FibraHotel
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Promotora and FibraHotel is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Promotora y Operadora and FibraHotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FibraHotel and Promotora 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 Promotora y Operadora are associated (or correlated) with FibraHotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FibraHotel has no effect on the direction of Promotora i.e., Promotora and FibraHotel go up and down completely randomly.
Pair Corralation between Promotora and FibraHotel
Assuming the 90 days trading horizon Promotora y Operadora is expected to generate 0.9 times more return on investment than FibraHotel. However, Promotora y Operadora is 1.11 times less risky than FibraHotel. It trades about 0.02 of its potential returns per unit of risk. FibraHotel is currently generating about -0.02 per unit of risk. If you would invest 17,672 in Promotora y Operadora on August 29, 2024 and sell it today you would earn a total of 1,039 from holding Promotora y Operadora or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Promotora y Operadora vs. FibraHotel
Performance |
| Timeline |
| Promotora y Operadora |
| FibraHotel |
Promotora and FibraHotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Promotora and FibraHotel
The main advantage of trading using opposite Promotora and FibraHotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Promotora position performs unexpectedly, FibraHotel 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 FibraHotel will offset losses from the drop in FibraHotel's long position.| Promotora vs. Gruma SAB de | Promotora vs. Grupo Aeroportuario del | Promotora vs. Grupo Aeroportuario del | Promotora vs. Grupo Aeroportuario del |
| FibraHotel vs. Promotora y Operadora | FibraHotel vs. Megacable Holdings S | FibraHotel vs. ALPEK SAB de | FibraHotel vs. Gentera SAB de |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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