Correlation Between Grupo Carso and SCIENCE IN

Can any of the company-specific risk be diversified away by investing in both Grupo Carso and SCIENCE IN 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 Carso and SCIENCE IN into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Grupo Carso SAB and SCIENCE IN SPORT, you can compare the effects of market volatilities on Grupo Carso and SCIENCE IN 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 Carso with a short position of SCIENCE IN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Carso and SCIENCE IN.

Diversification Opportunities for Grupo Carso and SCIENCE IN

0.22

Correlation Coefficient

Grupo Carso  SCIENCE IN

Modest diversification

The 3 months correlation between Grupo and SCIENCE is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Carso SAB and SCIENCE IN SPORT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCIENCE IN SPORT and Grupo Carso 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 Carso SAB are associated (or correlated) with SCIENCE IN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCIENCE IN SPORT has no effect on the direction of Grupo Carso i.e., Grupo Carso and SCIENCE IN go up and down completely randomly.

Pair Corralation between Grupo Carso and SCIENCE IN

Assuming the 90 days horizon Grupo Carso SAB is expected to generate 1.26 times more return on investment than SCIENCE IN. However, Grupo Carso is 1.26 times more volatile than SCIENCE IN SPORT. It trades about 0.09 of its potential returns per unit of risk. SCIENCE IN SPORT is currently generating about -0.12 per unit of risk. If you would invest  520.00  in Grupo Carso SAB on October 26, 2024 and sell it today you would earn a total of  15.00  from holding Grupo Carso SAB or generate 2.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Grupo Carso SAB  vs.  SCIENCE IN SPORT

Grupo Carso SAB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Grupo Carso SAB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Grupo Carso is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

SCIENCE IN SPORT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SCIENCE IN SPORT has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SCIENCE IN is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Grupo Carso and SCIENCE IN

The main advantage of trading using opposite Grupo Carso and SCIENCE IN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Carso position performs unexpectedly, SCIENCE IN 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 SCIENCE IN will offset losses from the drop in SCIENCE IN's long position.

The idea behind Grupo Carso SAB and SCIENCE IN SPORT pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.