Correlation Between Compania Cervecerias and Marti Technologies

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

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

Diversification Opportunities for Compania Cervecerias and Marti Technologies

-0.25

Correlation Coefficient

Compania Cervecerias  Marti Technologies

Very good diversification

The 3 months correlation between Compania and Marti is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Compania Cervecerias Unidas and Marti Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marti Technologies and Compania Cervecerias 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 Compania Cervecerias Unidas are associated (or correlated) with Marti Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marti Technologies has no effect on the direction of Compania Cervecerias i.e., Compania Cervecerias and Marti Technologies go up and down completely randomly.

Pair Corralation between Compania Cervecerias and Marti Technologies

Considering the 90-day investment horizon Compania Cervecerias Unidas is expected to generate 0.26 times more return on investment than Marti Technologies. However, Compania Cervecerias Unidas is 3.82 times less risky than Marti Technologies. It trades about 0.36 of its potential returns per unit of risk. Marti Technologies is currently generating about 0.03 per unit of risk. If you would invest  1,131  in Compania Cervecerias Unidas on December 28, 2024 and sell it today you would earn a total of  404.00  from holding Compania Cervecerias Unidas or generate 35.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Compania Cervecerias Unidas  vs.  Marti Technologies

Compania Cervecerias

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Compania Cervecerias Unidas are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating fundamental indicators, Compania Cervecerias unveiled solid returns over the last few months and may actually be approaching a breakup point.

Marti Technologies

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Marti Technologies are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Marti Technologies may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Compania Cervecerias and Marti Technologies

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

The idea behind Compania Cervecerias Unidas and Marti Technologies 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.