Correlation Between Grupo Televisa and GE Aerospace
Can any of the company-specific risk be diversified away by investing in both Grupo Televisa and GE Aerospace 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 Televisa and GE Aerospace into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Televisa SAB and GE Aerospace, you can compare the effects of market volatilities on Grupo Televisa and GE Aerospace 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 Televisa with a short position of GE Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Televisa and GE Aerospace.
Diversification Opportunities for Grupo Televisa and GE Aerospace
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Grupo and GE Aerospace is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Televisa SAB and GE Aerospace in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GE Aerospace and Grupo Televisa 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 Televisa SAB are associated (or correlated) with GE Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GE Aerospace has no effect on the direction of Grupo Televisa i.e., Grupo Televisa and GE Aerospace go up and down completely randomly.
Pair Corralation between Grupo Televisa and GE Aerospace
Assuming the 90 days horizon Grupo Televisa SAB is expected to generate 1.2 times more return on investment than GE Aerospace. However, Grupo Televisa is 1.2 times more volatile than GE Aerospace. It trades about 0.22 of its potential returns per unit of risk. GE Aerospace is currently generating about 0.13 per unit of risk. If you would invest 57.00 in Grupo Televisa SAB on January 20, 2024 and sell it today you would earn a total of 8.00 from holding Grupo Televisa SAB or generate 14.04% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 95.45% |
Values | Daily Returns |
Grupo Televisa SAB vs. GE Aerospace
Performance |
Timeline |
Grupo Televisa SAB |
GE Aerospace |
Grupo Televisa and GE Aerospace Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Grupo Televisa and GE Aerospace
The main advantage of trading using opposite Grupo Televisa and GE Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Televisa position performs unexpectedly, GE Aerospace 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 GE Aerospace will offset losses from the drop in GE Aerospace's long position.Grupo Televisa vs. Radcom | Grupo Televisa vs. FingerMotion | Grupo Televisa vs. KORE Group Holdings | Grupo Televisa vs. Consolidated Communications |
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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.
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