Correlation Between Gentera SAB and Alcoa Corp
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By analyzing existing cross correlation between Gentera SAB de and Alcoa Corp, you can compare the effects of market volatilities on Gentera SAB and Alcoa Corp 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 Gentera SAB with a short position of Alcoa Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gentera SAB and Alcoa Corp.
Diversification Opportunities for Gentera SAB and Alcoa Corp
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gentera and Alcoa is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Gentera SAB de and Alcoa Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alcoa Corp and Gentera SAB 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 Gentera SAB de are associated (or correlated) with Alcoa Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alcoa Corp has no effect on the direction of Gentera SAB i.e., Gentera SAB and Alcoa Corp go up and down completely randomly.
Pair Corralation between Gentera SAB and Alcoa Corp
Assuming the 90 days trading horizon Gentera SAB is expected to generate 14.59 times less return on investment than Alcoa Corp. But when comparing it to its historical volatility, Gentera SAB de is 1.29 times less risky than Alcoa Corp. It trades about 0.02 of its potential returns per unit of risk. Alcoa Corp is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 3,186 in Alcoa Corp on January 25, 2024 and sell it today you would earn a total of 420.00 from holding Alcoa Corp or generate 13.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Gentera SAB de vs. Alcoa Corp
Performance |
| Timeline |
| Gentera SAB de |
| Alcoa Corp |
Gentera SAB and Alcoa Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gentera SAB and Alcoa Corp
The main advantage of trading using opposite Gentera SAB and Alcoa Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gentera SAB position performs unexpectedly, Alcoa Corp 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 Alcoa Corp will offset losses from the drop in Alcoa Corp's long position.| Gentera SAB vs. Grupo Financiero Inbursa | Gentera SAB vs. Promotora y Operadora | Gentera SAB vs. ALPEK SAB de | Gentera SAB vs. Grupo Financiero Banorte |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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