Correlation Between Yoma Strategic and Arca Continental
Can any of the company-specific risk be diversified away by investing in both Yoma Strategic and Arca Continental 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 Yoma Strategic and Arca Continental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yoma Strategic Holdings and Arca Continental SAB, you can compare the effects of market volatilities on Yoma Strategic and Arca Continental 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 Yoma Strategic with a short position of Arca Continental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yoma Strategic and Arca Continental.
Diversification Opportunities for Yoma Strategic and Arca Continental
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Yoma and Arca is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Yoma Strategic Holdings and Arca Continental SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arca Continental SAB and Yoma Strategic 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 Yoma Strategic Holdings are associated (or correlated) with Arca Continental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arca Continental SAB has no effect on the direction of Yoma Strategic i.e., Yoma Strategic and Arca Continental go up and down completely randomly.
Pair Corralation between Yoma Strategic and Arca Continental
Assuming the 90 days horizon Yoma Strategic Holdings is expected to generate 6.55 times more return on investment than Arca Continental. However, Yoma Strategic is 6.55 times more volatile than Arca Continental SAB. It trades about 0.03 of its potential returns per unit of risk. Arca Continental SAB is currently generating about 0.02 per unit of risk. If you would invest 7.56 in Yoma Strategic Holdings on September 20, 2024 and sell it today you would lose (1.74) from holding Yoma Strategic Holdings or give up 23.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 91.83% |
| Values | Daily Returns |
Yoma Strategic Holdings vs. Arca Continental SAB
Performance |
| Timeline |
| Yoma Strategic Holdings |
| Arca Continental SAB |
Yoma Strategic and Arca Continental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yoma Strategic and Arca Continental
The main advantage of trading using opposite Yoma Strategic and Arca Continental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yoma Strategic position performs unexpectedly, Arca Continental 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 Arca Continental will offset losses from the drop in Arca Continental's long position.| Yoma Strategic vs. Arca Continental SAB | Yoma Strategic vs. Becle SA de | Yoma Strategic vs. Aquagold International | Yoma Strategic vs. Morningstar Unconstrained Allocation |
| Arca Continental vs. The Coca Cola | Arca Continental vs. Monster Beverage Corp | Arca Continental vs. Celsius Holdings | Arca Continental vs. Coca Cola Consolidated |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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