Correlation Between Semapa and Altri SGPS
Can any of the company-specific risk be diversified away by investing in both Semapa and Altri SGPS 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 Semapa and Altri SGPS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Semapa and Altri SGPS SA, you can compare the effects of market volatilities on Semapa and Altri SGPS 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 Semapa with a short position of Altri SGPS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Semapa and Altri SGPS.
Diversification Opportunities for Semapa and Altri SGPS
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Semapa and Altri is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Semapa and Altri SGPS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altri SGPS SA and Semapa 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 Semapa are associated (or correlated) with Altri SGPS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altri SGPS SA has no effect on the direction of Semapa i.e., Semapa and Altri SGPS go up and down completely randomly.
Pair Corralation between Semapa and Altri SGPS
Assuming the 90 days trading horizon Semapa is expected to under-perform the Altri SGPS. But the stock apears to be less risky and, when comparing its historical volatility, Semapa is 1.13 times less risky than Altri SGPS. The stock trades about -0.26 of its potential returns per unit of risk. The Altri SGPS SA is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 497.00 in Altri SGPS SA on September 1, 2024 and sell it today you would earn a total of 1.00 from holding Altri SGPS SA or generate 0.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Semapa vs. Altri SGPS SA
Performance |
| Timeline |
| Semapa |
| Altri SGPS SA |
Semapa and Altri SGPS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Semapa and Altri SGPS
The main advantage of trading using opposite Semapa and Altri SGPS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Semapa position performs unexpectedly, Altri SGPS 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 Altri SGPS will offset losses from the drop in Altri SGPS's long position.| Semapa vs. Altri SGPS SA | Semapa vs. The Navigator | Semapa vs. Sonae SGPS SA | Semapa vs. Mota Engil SGPS SA |
| Altri SGPS vs. The Navigator | Altri SGPS vs. Sonae SGPS SA | Altri SGPS vs. NOS SGPS SA | Altri SGPS vs. Galp Energia SGPS |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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