Correlation Between Ross Stores and Financiera Independencia
Can any of the company-specific risk be diversified away by investing in both Ross Stores and Financiera Independencia 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 Ross Stores and Financiera Independencia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ross Stores and Financiera Independencia SAB, you can compare the effects of market volatilities on Ross Stores and Financiera Independencia 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 Ross Stores with a short position of Financiera Independencia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and Financiera Independencia.
Diversification Opportunities for Ross Stores and Financiera Independencia
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ross and Financiera is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and Financiera Independencia SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Financiera Independencia and Ross Stores 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 Ross Stores are associated (or correlated) with Financiera Independencia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Financiera Independencia has no effect on the direction of Ross Stores i.e., Ross Stores and Financiera Independencia go up and down completely randomly.
Pair Corralation between Ross Stores and Financiera Independencia
Assuming the 90 days trading horizon Ross Stores is expected to generate 1.77 times more return on investment than Financiera Independencia. However, Ross Stores is 1.77 times more volatile than Financiera Independencia SAB. It trades about 0.17 of its potential returns per unit of risk. Financiera Independencia SAB is currently generating about -0.11 per unit of risk. If you would invest 265,214 in Ross Stores on September 2, 2024 and sell it today you would earn a total of 43,286 from holding Ross Stores or generate 16.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 31.75% |
| Values | Daily Returns |
Ross Stores vs. Financiera Independencia SAB
Performance |
| Timeline |
| Ross Stores |
| Financiera Independencia |
Ross Stores and Financiera Independencia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ross Stores and Financiera Independencia
The main advantage of trading using opposite Ross Stores and Financiera Independencia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ross Stores position performs unexpectedly, Financiera Independencia 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 Financiera Independencia will offset losses from the drop in Financiera Independencia's long position.| Ross Stores vs. DXC Technology | Ross Stores vs. Southwest Airlines | Ross Stores vs. Grupo Sports World | Ross Stores vs. Lloyds Banking Group |
| Financiera Independencia vs. Promotora y Operadora | Financiera Independencia vs. ALPEK SAB de | Financiera Independencia vs. El Puerto 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 CEOs Directory module to screen CEOs from public companies around the world.
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