Correlation Between Airtel Africa and América Móvil,

Can any of the company-specific risk be diversified away by investing in both Airtel Africa and América Móvil, 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 Airtel Africa and América Móvil, into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Airtel Africa Plc and Amrica Mvil, SAB, you can compare the effects of market volatilities on Airtel Africa and América Móvil, 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 Airtel Africa with a short position of América Móvil,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airtel Africa and América Móvil,.

Diversification Opportunities for Airtel Africa and América Móvil,

0.32

Correlation Coefficient

Airtel Africa  América Móvil,

Weak diversification

The 3 months correlation between Airtel and América is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Airtel Africa Plc and Amrica Mvil, SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amrica Mvil, SAB and Airtel Africa 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 Airtel Africa Plc are associated (or correlated) with América Móvil,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amrica Mvil, SAB has no effect on the direction of Airtel Africa i.e., Airtel Africa and América Móvil, go up and down completely randomly.

Pair Corralation between Airtel Africa and América Móvil,

Assuming the 90 days horizon Airtel Africa is expected to generate 20.2 times less return on investment than América Móvil,. But when comparing it to its historical volatility, Airtel Africa Plc is 4.49 times less risky than América Móvil,. It trades about 0.02 of its potential returns per unit of risk. Amrica Mvil, SAB is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  30.00  in Amrica Mvil, SAB on October 5, 2024 and sell it today you would earn a total of  56.00  from holding Amrica Mvil, SAB or generate 186.67% return on investment over 90 days.

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

Airtel Africa Plc  vs.  Amrica Mvil, SAB

Airtel Africa Plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Airtel Africa Plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Amrica Mvil, SAB

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Amrica Mvil, SAB are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, América Móvil, reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Airtel Africa and América Móvil,

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

The idea behind Airtel Africa Plc and Amrica Mvil, SAB 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.

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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.