Correlation Between Corporacion America and XMReality

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Can any of the company-specific risk be diversified away by investing in both Corporacion America and XMReality 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 Corporacion America and XMReality into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corporacion America Airports and XMReality AB, you can compare the effects of market volatilities on Corporacion America and XMReality 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 Corporacion America with a short position of XMReality. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporacion America and XMReality.

Diversification Opportunities for Corporacion America and XMReality

CorporacionXMRealityDiversified AwayCorporacionXMRealityDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Corporacion and XMReality is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Corporacion America Airports and XMReality AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XMReality AB and Corporacion America 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 Corporacion America Airports are associated (or correlated) with XMReality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XMReality AB has no effect on the direction of Corporacion America i.e., Corporacion America and XMReality go up and down completely randomly.

Pair Corralation between Corporacion America and XMReality

If you would invest  1,819  in Corporacion America Airports on October 16, 2024 and sell it today you would earn a total of  42.00  from holding Corporacion America Airports or generate 2.31% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy1.67%
ValuesDaily Returns

Corporacion America Airports  vs.  XMReality AB

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec 051015
JavaScript chart by amCharts 3.21.15CAAP XMMRF
       Timeline  
Corporacion America 

Risk-Adjusted Performance

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Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Corporacion America Airports are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Corporacion America is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan17.51818.51919.52020.5
XMReality AB 

Risk-Adjusted Performance

0 of 100

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

Corporacion America and XMReality Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-7.42-5.56-3.69-1.830.0311.913.835.747.66 0.010.020.030.040.050.060.07
JavaScript chart by amCharts 3.21.15CAAP XMMRF
       Returns  

Pair Trading with Corporacion America and XMReality

The main advantage of trading using opposite Corporacion America and XMReality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corporacion America position performs unexpectedly, XMReality 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 XMReality will offset losses from the drop in XMReality's long position.
The idea behind Corporacion America Airports and XMReality AB 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.

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