Correlation Between Grupo Simec and Universal Media
Can any of the company-specific risk be diversified away by investing in both Grupo Simec and Universal Media 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 Universal Media 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 Universal Media Group, you can compare the effects of market volatilities on Grupo Simec and Universal Media 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 Universal Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Simec and Universal Media.
Diversification Opportunities for Grupo Simec and Universal Media
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grupo and Universal is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Simec SAB and Universal Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Media Group 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 Universal Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Media Group has no effect on the direction of Grupo Simec i.e., Grupo Simec and Universal Media go up and down completely randomly.
Pair Corralation between Grupo Simec and Universal Media
Considering the 90-day investment horizon Grupo Simec is expected to generate 15.23 times less return on investment than Universal Media. But when comparing it to its historical volatility, Grupo Simec SAB is 11.12 times less risky than Universal Media. It trades about 0.06 of its potential returns per unit of risk. Universal Media Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3.00 in Universal Media Group on September 4, 2024 and sell it today you would lose (0.60) from holding Universal Media Group or give up 20.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Grupo Simec SAB vs. Universal Media Group
Performance |
| Timeline |
| Grupo Simec SAB |
| Universal Media Group |
Grupo Simec and Universal Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Simec and Universal Media
The main advantage of trading using opposite Grupo Simec and Universal Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Simec position performs unexpectedly, Universal Media 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 Universal Media will offset losses from the drop in Universal Media's long position.| Grupo Simec vs. Constellium Nv | Grupo Simec vs. Century Aluminum | Grupo Simec vs. China Hongqiao Group | Grupo Simec vs. Kaiser Aluminum |
| Universal Media vs. Telefonica Brasil SA | Universal Media vs. Vodafone Group PLC | Universal Media vs. Grupo Televisa SAB | Universal Media vs. America Movil SAB |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |