Correlation Between Adventus Mining and Grupo Mxico

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

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

Diversification Opportunities for Adventus Mining and Grupo Mxico

0.75

Correlation Coefficient

Adventus Mining  Grupo Mxico

Poor diversification

The 3 months correlation between Adventus and Grupo is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Adventus Mining and Grupo Mxico SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Mxico SAB and Adventus Mining 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 Adventus Mining are associated (or correlated) with Grupo Mxico. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Mxico SAB has no effect on the direction of Adventus Mining i.e., Adventus Mining and Grupo Mxico go up and down completely randomly.

Pair Corralation between Adventus Mining and Grupo Mxico

If you would invest  528.00  in Grupo Mxico SAB on September 12, 2024 and sell it today you would lose (7.00) from holding Grupo Mxico SAB or give up 1.33% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	1.59%
Values	Daily Returns

Adventus Mining  vs.  Grupo Mxico SAB

Adventus Mining

Risk-Adjusted Performance

0 of 100

Very Weak

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

Grupo Mxico SAB

Risk-Adjusted Performance

0 of 100

Weak

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

Pair Trading with Adventus Mining and Grupo Mxico

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

The idea behind Adventus Mining and Grupo Mxico 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.

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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.