Correlation Between Telecom Argentina and INTER CARS
Can any of the company-specific risk be diversified away by investing in both Telecom Argentina and INTER CARS 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 Telecom Argentina and INTER CARS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telecom Argentina SA and INTER CARS SA, you can compare the effects of market volatilities on Telecom Argentina and INTER CARS 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 Telecom Argentina with a short position of INTER CARS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telecom Argentina and INTER CARS.
Diversification Opportunities for Telecom Argentina and INTER CARS
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Telecom and INTER is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Telecom Argentina SA and INTER CARS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTER CARS SA and Telecom Argentina 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 Telecom Argentina SA are associated (or correlated) with INTER CARS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTER CARS SA has no effect on the direction of Telecom Argentina i.e., Telecom Argentina and INTER CARS go up and down completely randomly.
Pair Corralation between Telecom Argentina and INTER CARS
Assuming the 90 days horizon Telecom Argentina is expected to generate 38.75 times less return on investment than INTER CARS. In addition to that, Telecom Argentina is 2.15 times more volatile than INTER CARS SA. It trades about 0.01 of its total potential returns per unit of risk. INTER CARS SA is currently generating about 0.49 per unit of volatility. If you would invest 11,680 in INTER CARS SA on October 22, 2024 and sell it today you would earn a total of 1,780 from holding INTER CARS SA or generate 15.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telecom Argentina SA vs. INTER CARS SA
Performance |
| Timeline |
| Telecom Argentina |
| INTER CARS SA |
Telecom Argentina and INTER CARS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telecom Argentina and INTER CARS
The main advantage of trading using opposite Telecom Argentina and INTER CARS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telecom Argentina position performs unexpectedly, INTER CARS 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 INTER CARS will offset losses from the drop in INTER CARS's long position.| Telecom Argentina vs. Chesapeake Utilities | Telecom Argentina vs. Park Hotels Resorts | Telecom Argentina vs. Liberty Broadband | Telecom Argentina vs. Broadwind |
| INTER CARS vs. Telecom Argentina SA | INTER CARS vs. GAMING FAC SA | INTER CARS vs. HUTCHISON TELECOMM | INTER CARS vs. Gaming and Leisure |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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