Correlation Between Grupo Sports and Companhia Siderrgica
Can any of the company-specific risk be diversified away by investing in both Grupo Sports and Companhia Siderrgica 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 Sports and Companhia Siderrgica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Sports World and Companhia Siderrgica Nacional, you can compare the effects of market volatilities on Grupo Sports and Companhia Siderrgica 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 Sports with a short position of Companhia Siderrgica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Sports and Companhia Siderrgica.
Diversification Opportunities for Grupo Sports and Companhia Siderrgica
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grupo and Companhia is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Sports World and Companhia Siderrgica Nacional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Companhia Siderrgica and Grupo Sports 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 Sports World are associated (or correlated) with Companhia Siderrgica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Companhia Siderrgica has no effect on the direction of Grupo Sports i.e., Grupo Sports and Companhia Siderrgica go up and down completely randomly.
Pair Corralation between Grupo Sports and Companhia Siderrgica
Assuming the 90 days trading horizon Grupo Sports World is expected to generate 0.79 times more return on investment than Companhia Siderrgica. However, Grupo Sports World is 1.26 times less risky than Companhia Siderrgica. It trades about 0.16 of its potential returns per unit of risk. Companhia Siderrgica Nacional is currently generating about 0.01 per unit of risk. If you would invest 460.00 in Grupo Sports World on September 5, 2024 and sell it today you would earn a total of 178.00 from holding Grupo Sports World or generate 38.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Grupo Sports World vs. Companhia Siderrgica Nacional
Performance |
| Timeline |
| Grupo Sports World |
| Companhia Siderrgica |
Grupo Sports and Companhia Siderrgica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Sports and Companhia Siderrgica
The main advantage of trading using opposite Grupo Sports and Companhia Siderrgica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Sports position performs unexpectedly, Companhia Siderrgica 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 Companhia Siderrgica will offset losses from the drop in Companhia Siderrgica's long position.| Grupo Sports vs. Axtel SAB de | Grupo Sports vs. Fomento Econmico Mexicano | Grupo Sports vs. Lloyds Banking Group | Grupo Sports vs. Apple Inc |
| Companhia Siderrgica vs. Micron Technology | Companhia Siderrgica vs. United States Steel | Companhia Siderrgica vs. Grupo Sports World | Companhia Siderrgica vs. FibraHotel |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |