Correlation Between Altia Consultores and Squirrel Media

Can any of the company-specific risk be diversified away by investing in both Altia Consultores and Squirrel Media 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 Altia Consultores and Squirrel Media into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Altia Consultores SA and Squirrel Media SA, you can compare the effects of market volatilities on Altia Consultores and Squirrel Media 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 Altia Consultores with a short position of Squirrel Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altia Consultores and Squirrel Media.

Diversification Opportunities for Altia Consultores and Squirrel Media

0.32

Correlation Coefficient

Altia Consultores  Squirrel Media

Weak diversification

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

Pair Corralation between Altia Consultores and Squirrel Media

Assuming the 90 days trading horizon Altia Consultores SA is expected to under-perform the Squirrel Media. In addition to that, Altia Consultores is 1.03 times more volatile than Squirrel Media SA. It trades about -0.03 of its total potential returns per unit of risk. Squirrel Media SA is currently generating about -0.01 per unit of volatility. If you would invest  143.00  in Squirrel Media SA on October 21, 2024 and sell it today you would lose (3.00) from holding Squirrel Media SA or give up 2.1% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Altia Consultores SA  vs.  Squirrel Media SA

Altia Consultores

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Altia Consultores SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Altia Consultores is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Squirrel Media SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Squirrel Media SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Squirrel Media is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Altia Consultores and Squirrel Media

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

The idea behind Altia Consultores SA and Squirrel Media SA 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.