Correlation Between Grupo Security and Enel Generacin
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By analyzing existing cross correlation between Grupo Security and Enel Generacin Chile, you can compare the effects of market volatilities on Grupo Security and Enel Generacin 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 Grupo Security with a short position of Enel Generacin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Security and Enel Generacin.
Diversification Opportunities for Grupo Security and Enel Generacin
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Grupo and Enel is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Security and Enel Generacin Chile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enel Generacin Chile and Grupo Security 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 Grupo Security are associated (or correlated) with Enel Generacin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enel Generacin Chile has no effect on the direction of Grupo Security i.e., Grupo Security and Enel Generacin go up and down completely randomly.
Pair Corralation between Grupo Security and Enel Generacin
Assuming the 90 days trading horizon Grupo Security is expected to under-perform the Enel Generacin. But the stock apears to be less risky and, when comparing its historical volatility, Grupo Security is 1.08 times less risky than Enel Generacin. The stock trades about -0.14 of its potential returns per unit of risk. The Enel Generacin Chile is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 36,895 in Enel Generacin Chile on September 14, 2024 and sell it today you would earn a total of 573.00 from holding Enel Generacin Chile or generate 1.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Security vs. Enel Generacin Chile
Performance |
| Timeline |
| Grupo Security |
| Enel Generacin Chile |
Grupo Security and Enel Generacin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Security and Enel Generacin
The main advantage of trading using opposite Grupo Security and Enel Generacin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Security position performs unexpectedly, Enel Generacin 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 Enel Generacin will offset losses from the drop in Enel Generacin's long position.| Grupo Security vs. Grupo Empresas Navieras | Grupo Security vs. Aguas Andinas SA | Grupo Security vs. Parq Arauco | Grupo Security vs. Enel Generacin Chile |
| Enel Generacin vs. LATAM Airlines Group | Enel Generacin vs. Multiexport Foods SA | Enel Generacin vs. Banco de Credito |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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