Correlation Between Techo Hogar and All Iron
Can any of the company-specific risk be diversified away by investing in both Techo Hogar and All Iron 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 Techo Hogar and All Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Techo Hogar SOCIMI, and All Iron Re, you can compare the effects of market volatilities on Techo Hogar and All Iron 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 Techo Hogar with a short position of All Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Techo Hogar and All Iron.
Diversification Opportunities for Techo Hogar and All Iron
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Techo and All is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Techo Hogar SOCIMI, and All Iron Re in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on All Iron Re and Techo Hogar 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 Techo Hogar SOCIMI, are associated (or correlated) with All Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of All Iron Re has no effect on the direction of Techo Hogar i.e., Techo Hogar and All Iron go up and down completely randomly.
Pair Corralation between Techo Hogar and All Iron
Assuming the 90 days trading horizon Techo Hogar is expected to generate 2.7 times less return on investment than All Iron. But when comparing it to its historical volatility, Techo Hogar SOCIMI, is 8.24 times less risky than All Iron. It trades about 0.02 of its potential returns per unit of risk. All Iron Re is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,100 in All Iron Re on August 28, 2024 and sell it today you would lose (50.00) from holding All Iron Re or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 30.14% |
| Values | Daily Returns |
Techo Hogar SOCIMI, vs. All Iron Re
Performance |
| Timeline |
| Techo Hogar SOCIMI, |
| All Iron Re |
Techo Hogar and All Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Techo Hogar and All Iron
The main advantage of trading using opposite Techo Hogar and All Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Techo Hogar position performs unexpectedly, All Iron 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 All Iron will offset losses from the drop in All Iron's long position.| Techo Hogar vs. Airbus Group SE | Techo Hogar vs. Industria de Diseno | Techo Hogar vs. Iberdrola SA | Techo Hogar vs. Petroleo Brasileiro SA |
| All Iron vs. Melia Hotels | All Iron vs. Vytrus Biotech SA | All Iron vs. Aedas Homes SL | All Iron vs. International Consolidated Airlines |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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