Correlation Between Torque Lifestyle and Grupo Bimbo
Can any of the company-specific risk be diversified away by investing in both Torque Lifestyle and Grupo Bimbo 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 Torque Lifestyle and Grupo Bimbo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Torque Lifestyle Brands and Grupo Bimbo SAB, you can compare the effects of market volatilities on Torque Lifestyle and Grupo Bimbo 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 Torque Lifestyle with a short position of Grupo Bimbo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Torque Lifestyle and Grupo Bimbo.
Diversification Opportunities for Torque Lifestyle and Grupo Bimbo
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Torque and Grupo is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Torque Lifestyle Brands and Grupo Bimbo SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Bimbo SAB and Torque Lifestyle 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 Torque Lifestyle Brands are associated (or correlated) with Grupo Bimbo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Bimbo SAB has no effect on the direction of Torque Lifestyle i.e., Torque Lifestyle and Grupo Bimbo go up and down completely randomly.
Pair Corralation between Torque Lifestyle and Grupo Bimbo
Given the investment horizon of 90 days Torque Lifestyle Brands is expected to generate 31.68 times more return on investment than Grupo Bimbo. However, Torque Lifestyle is 31.68 times more volatile than Grupo Bimbo SAB. It trades about 0.17 of its potential returns per unit of risk. Grupo Bimbo SAB is currently generating about -0.24 per unit of risk. If you would invest 0.16 in Torque Lifestyle Brands on September 12, 2024 and sell it today you would earn a total of 0.01 from holding Torque Lifestyle Brands or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Torque Lifestyle Brands vs. Grupo Bimbo SAB
Performance |
| Timeline |
| Torque Lifestyle Brands |
| Grupo Bimbo SAB |
Torque Lifestyle and Grupo Bimbo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Torque Lifestyle and Grupo Bimbo
The main advantage of trading using opposite Torque Lifestyle and Grupo Bimbo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Torque Lifestyle position performs unexpectedly, Grupo Bimbo 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 Grupo Bimbo will offset losses from the drop in Grupo Bimbo's long position.| Torque Lifestyle vs. BRF SA ADR | Torque Lifestyle vs. Pilgrims Pride Corp | Torque Lifestyle vs. John B Sanfilippo | Torque Lifestyle vs. Seneca Foods Corp |
| Grupo Bimbo vs. Treehouse Foods | Grupo Bimbo vs. Lancaster Colony | Grupo Bimbo vs. Utz Brands | Grupo Bimbo vs. Lamb Weston Holdings |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |