Correlation Between IM Vinaria and Compa Sibiu
Can any of the company-specific risk be diversified away by investing in both IM Vinaria and Compa Sibiu 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 IM Vinaria and Compa Sibiu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IM Vinaria Purcari and Compa Sibiu, you can compare the effects of market volatilities on IM Vinaria and Compa Sibiu 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 IM Vinaria with a short position of Compa Sibiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of IM Vinaria and Compa Sibiu.
Diversification Opportunities for IM Vinaria and Compa Sibiu
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between WINE and Compa is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding IM Vinaria Purcari and Compa Sibiu in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compa Sibiu and IM Vinaria 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 IM Vinaria Purcari are associated (or correlated) with Compa Sibiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compa Sibiu has no effect on the direction of IM Vinaria i.e., IM Vinaria and Compa Sibiu go up and down completely randomly.
Pair Corralation between IM Vinaria and Compa Sibiu
Assuming the 90 days trading horizon IM Vinaria Purcari is expected to generate 0.26 times more return on investment than Compa Sibiu. However, IM Vinaria Purcari is 3.89 times less risky than Compa Sibiu. It trades about 0.07 of its potential returns per unit of risk. Compa Sibiu is currently generating about -0.16 per unit of risk. If you would invest 1,480 in IM Vinaria Purcari on August 29, 2024 and sell it today you would earn a total of 8.00 from holding IM Vinaria Purcari or generate 0.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
IM Vinaria Purcari vs. Compa Sibiu
Performance |
| Timeline |
| IM Vinaria Purcari |
| Compa Sibiu |
IM Vinaria and Compa Sibiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IM Vinaria and Compa Sibiu
The main advantage of trading using opposite IM Vinaria and Compa Sibiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IM Vinaria position performs unexpectedly, Compa Sibiu 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 Compa Sibiu will offset losses from the drop in Compa Sibiu's long position.| IM Vinaria vs. Teraplast Bist | IM Vinaria vs. Electroarges S | IM Vinaria vs. Comvex SA | IM Vinaria vs. Feper SA |
| Compa Sibiu vs. IM Vinaria Purcari | Compa Sibiu vs. TRANSILVANIA INVESTMENTS ALLIANCE | Compa Sibiu vs. Evergent Investments SA | Compa Sibiu vs. Safetech Innovations SA |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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