Correlation Between ANT and Budimex SA

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

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

Diversification Opportunities for ANT and Budimex SA

-0.02

Correlation Coefficient

ANT  Budimex SA

Good diversification

The 3 months correlation between ANT and Budimex is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding ANT and Budimex SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Budimex SA and ANT 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 ANT are associated (or correlated) with Budimex SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Budimex SA has no effect on the direction of ANT i.e., ANT and Budimex SA go up and down completely randomly.

Pair Corralation between ANT and Budimex SA

Assuming the 90 days trading horizon ANT is expected to generate 13.67 times more return on investment than Budimex SA. However, ANT is 13.67 times more volatile than Budimex SA. It trades about 0.09 of its potential returns per unit of risk. Budimex SA is currently generating about 0.0 per unit of risk. If you would invest  147.00  in ANT on October 25, 2024 and sell it today you would earn a total of  0.00  from holding ANT or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	76.19%
Values	Daily Returns

ANT  vs.  Budimex SA

ANT

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ANT are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, ANT exhibited solid returns over the last few months and may actually be approaching a breakup point.

Budimex SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Budimex SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with ANT and Budimex SA

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

The idea behind ANT and Budimex 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.

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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.