Correlation Between San Miguel and Morixe Hermanos
Can any of the company-specific risk be diversified away by investing in both San Miguel and Morixe Hermanos 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 San Miguel and Morixe Hermanos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between San Miguel AG and Morixe Hermanos SACI, you can compare the effects of market volatilities on San Miguel and Morixe Hermanos 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 San Miguel with a short position of Morixe Hermanos. Check out your portfolio center. Please also check ongoing floating volatility patterns of San Miguel and Morixe Hermanos.
Diversification Opportunities for San Miguel and Morixe Hermanos
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between San and Morixe is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding San Miguel AG and Morixe Hermanos SACI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morixe Hermanos SACI and San Miguel 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 San Miguel AG are associated (or correlated) with Morixe Hermanos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morixe Hermanos SACI has no effect on the direction of San Miguel i.e., San Miguel and Morixe Hermanos go up and down completely randomly.
Pair Corralation between San Miguel and Morixe Hermanos
Assuming the 90 days trading horizon San Miguel AG is expected to generate 1.1 times more return on investment than Morixe Hermanos. However, San Miguel is 1.1 times more volatile than Morixe Hermanos SACI. It trades about -0.1 of its potential returns per unit of risk. Morixe Hermanos SACI is currently generating about -0.27 per unit of risk. If you would invest 131,500 in San Miguel AG on November 2, 2024 and sell it today you would lose (10,000) from holding San Miguel AG or give up 7.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
San Miguel AG vs. Morixe Hermanos SACI
Performance |
| Timeline |
| San Miguel AG |
| Morixe Hermanos SACI |
San Miguel and Morixe Hermanos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with San Miguel and Morixe Hermanos
The main advantage of trading using opposite San Miguel and Morixe Hermanos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if San Miguel position performs unexpectedly, Morixe Hermanos 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 Morixe Hermanos will offset losses from the drop in Morixe Hermanos' long position.| San Miguel vs. Compania de Transporte | San Miguel vs. Agrometal SAI | San Miguel vs. Harmony Gold Mining | San Miguel vs. Transportadora de Gas |
| Morixe Hermanos vs. Ledesma SAAI | Morixe Hermanos vs. Molinos Juan Semino | Morixe Hermanos vs. Boldt SA | Morixe Hermanos vs. Agrometal SAI |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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