Correlation Between Grupo Aeroportuario and Companhia Energtica
Can any of the company-specific risk be diversified away by investing in both Grupo Aeroportuario and Companhia Energtica 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 Grupo Aeroportuario and Companhia Energtica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Aeroportuario del and Companhia Energtica de, you can compare the effects of market volatilities on Grupo Aeroportuario and Companhia Energtica 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 Grupo Aeroportuario with a short position of Companhia Energtica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Aeroportuario and Companhia Energtica.
Diversification Opportunities for Grupo Aeroportuario and Companhia Energtica
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grupo and Companhia is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Aeroportuario del and Companhia Energtica de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Companhia Energtica and Grupo Aeroportuario 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 Grupo Aeroportuario del are associated (or correlated) with Companhia Energtica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Companhia Energtica has no effect on the direction of Grupo Aeroportuario i.e., Grupo Aeroportuario and Companhia Energtica go up and down completely randomly.
Pair Corralation between Grupo Aeroportuario and Companhia Energtica
Assuming the 90 days trading horizon Grupo Aeroportuario is expected to generate 3.06 times less return on investment than Companhia Energtica. But when comparing it to its historical volatility, Grupo Aeroportuario del is 2.29 times less risky than Companhia Energtica. It trades about 0.14 of its potential returns per unit of risk. Companhia Energtica de is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 3,893 in Companhia Energtica de on January 20, 2024 and sell it today you would earn a total of 356.00 from holding Companhia Energtica de or generate 9.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Grupo Aeroportuario del vs. Companhia Energtica de
Performance |
| Timeline |
| Grupo Aeroportuario del |
| Companhia Energtica |
Grupo Aeroportuario and Companhia Energtica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Aeroportuario and Companhia Energtica
The main advantage of trading using opposite Grupo Aeroportuario and Companhia Energtica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Aeroportuario position performs unexpectedly, Companhia Energtica 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 Companhia Energtica will offset losses from the drop in Companhia Energtica's long position.| Grupo Aeroportuario vs. Grupo Aeroportuario del | Grupo Aeroportuario vs. Grupo Aeroportuario del | Grupo Aeroportuario vs. Gruma SAB de | Grupo Aeroportuario vs. Grupo Financiero Banorte |
| Companhia Energtica vs. Air Transport Services | Companhia Energtica vs. Grupo Sports World | Companhia Energtica vs. Micron Technology | Companhia Energtica vs. United States Steel |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |