Correlation Between Promotora and Grupo Industrial
Can any of the company-specific risk be diversified away by investing in both Promotora and Grupo Industrial 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 Grupo Industrial 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 Grupo Industrial Saltillo, you can compare the effects of market volatilities on Promotora and Grupo Industrial 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 Grupo Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Promotora and Grupo Industrial.
Diversification Opportunities for Promotora and Grupo Industrial
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Promotora and Grupo is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Promotora y Operadora and Grupo Industrial Saltillo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Industrial Saltillo 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 Grupo Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Industrial Saltillo has no effect on the direction of Promotora i.e., Promotora and Grupo Industrial go up and down completely randomly.
Pair Corralation between Promotora and Grupo Industrial
Assuming the 90 days trading horizon Promotora y Operadora is expected to generate 1.02 times more return on investment than Grupo Industrial. However, Promotora is 1.02 times more volatile than Grupo Industrial Saltillo. It trades about 0.04 of its potential returns per unit of risk. Grupo Industrial Saltillo is currently generating about -0.03 per unit of risk. If you would invest 17,844 in Promotora y Operadora on October 24, 2024 and sell it today you would earn a total of 700.00 from holding Promotora y Operadora or generate 3.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.77% |
| Values | Daily Returns |
Promotora y Operadora vs. Grupo Industrial Saltillo
Performance |
| Timeline |
| Promotora y Operadora |
| Grupo Industrial Saltillo |
Promotora and Grupo Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Promotora and Grupo Industrial
The main advantage of trading using opposite Promotora and Grupo Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Promotora position performs unexpectedly, Grupo Industrial 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 Industrial will offset losses from the drop in Grupo Industrial's long position.| Promotora vs. Gruma SAB de | Promotora vs. Grupo Aeroportuario del | Promotora vs. Grupo Aeroportuario del | Promotora vs. Grupo Aeroportuario del |
| Grupo Industrial vs. Cydsa SAB de | Grupo Industrial vs. Promotora y Operadora | Grupo Industrial vs. Grupo KUO SAB | Grupo Industrial vs. Organizacin Cultiba SAB |
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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