Correlation Between Grupo Simec and SunOpta
Can any of the company-specific risk be diversified away by investing in both Grupo Simec and SunOpta 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 Grupo Simec and SunOpta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Simec SAB and SunOpta, you can compare the effects of market volatilities on Grupo Simec and SunOpta 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 Simec with a short position of SunOpta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Simec and SunOpta.
Diversification Opportunities for Grupo Simec and SunOpta
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grupo and SunOpta is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Simec SAB and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta and Grupo Simec 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 Simec SAB are associated (or correlated) with SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of Grupo Simec i.e., Grupo Simec and SunOpta go up and down completely randomly.
Pair Corralation between Grupo Simec and SunOpta
Considering the 90-day investment horizon Grupo Simec SAB is expected to under-perform the SunOpta. But the stock apears to be less risky and, when comparing its historical volatility, Grupo Simec SAB is 1.24 times less risky than SunOpta. The stock trades about -0.11 of its potential returns per unit of risk. The SunOpta is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 598.00 in SunOpta on August 27, 2024 and sell it today you would earn a total of 184.00 from holding SunOpta or generate 30.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Simec SAB vs. SunOpta
Performance |
| Timeline |
| Grupo Simec SAB |
| SunOpta |
Grupo Simec and SunOpta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Simec and SunOpta
The main advantage of trading using opposite Grupo Simec and SunOpta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Simec position performs unexpectedly, SunOpta 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 SunOpta will offset losses from the drop in SunOpta's long position.| Grupo Simec vs. Synalloy | Grupo Simec vs. Mesabi Trust | Grupo Simec vs. Algoma Steel Group | Grupo Simec vs. Olympic Steel |
| SunOpta vs. Seneca Foods Corp | SunOpta vs. Central Garden Pet | SunOpta vs. Central Garden Pet | SunOpta vs. Natures Sunshine Products |
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 Stocks Directory module to find actively traded stocks across global markets.
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