Correlation Between Compania and Grupo Supervielle
Can any of the company-specific risk be diversified away by investing in both Compania and Grupo Supervielle 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 Compania and Grupo Supervielle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compania de Transporte and Grupo Supervielle SA, you can compare the effects of market volatilities on Compania and Grupo Supervielle 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 Compania with a short position of Grupo Supervielle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compania and Grupo Supervielle.
Diversification Opportunities for Compania and Grupo Supervielle
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Compania and Grupo is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Compania de Transporte and Grupo Supervielle SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Supervielle and Compania 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 Compania de Transporte are associated (or correlated) with Grupo Supervielle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Supervielle has no effect on the direction of Compania i.e., Compania and Grupo Supervielle go up and down completely randomly.
Pair Corralation between Compania and Grupo Supervielle
Assuming the 90 days trading horizon Compania is expected to generate 1.21 times less return on investment than Grupo Supervielle. But when comparing it to its historical volatility, Compania de Transporte is 1.07 times less risky than Grupo Supervielle. It trades about 0.15 of its potential returns per unit of risk. Grupo Supervielle SA is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 20,480 in Grupo Supervielle SA on October 13, 2024 and sell it today you would earn a total of 443,520 from holding Grupo Supervielle SA or generate 2165.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Compania de Transporte vs. Grupo Supervielle SA
Performance |
| Timeline |
| Compania de Transporte |
| Grupo Supervielle |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Strong
Compania and Grupo Supervielle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compania and Grupo Supervielle
The main advantage of trading using opposite Compania and Grupo Supervielle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compania position performs unexpectedly, Grupo Supervielle 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 Supervielle will offset losses from the drop in Grupo Supervielle's long position.The idea behind Compania de Transporte and Grupo Supervielle SA 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.| Grupo Supervielle vs. Agrometal SAI | Grupo Supervielle vs. Transportadora de Gas | Grupo Supervielle vs. Telecom Argentina | Grupo Supervielle vs. Harmony Gold Mining |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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