Correlation Between Grupo De and Enel Generacin

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Can any of the company-specific risk be diversified away by investing in both Grupo De and Enel Generacin 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 De and Enel Generacin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo De Inversiones and Enel Generacin Chile, you can compare the effects of market volatilities on Grupo De 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 De with a short position of Enel Generacin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo De and Enel Generacin.

Diversification Opportunities for Grupo De and Enel Generacin

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Grupo and Enel is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Grupo De Inversiones 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 De 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 De Inversiones 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 De i.e., Grupo De and Enel Generacin go up and down completely randomly.

Pair Corralation between Grupo De and Enel Generacin

If you would invest  36,266  in Enel Generacin Chile on September 12, 2024 and sell it today you would earn a total of  1,231  from holding Enel Generacin Chile or generate 3.39% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Grupo De Inversiones  vs.  Enel Generacin Chile

 Performance 
       Timeline  
Grupo De Inversiones 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Grupo De Inversiones has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Grupo De is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.
Enel Generacin Chile 

Risk-Adjusted Performance

21 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Enel Generacin Chile are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Enel Generacin exhibited solid returns over the last few months and may actually be approaching a breakup point.

Grupo De and Enel Generacin Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Grupo De and Enel Generacin

The main advantage of trading using opposite Grupo De and Enel Generacin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo De 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.
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The idea behind Grupo De Inversiones and Enel Generacin Chile pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.

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