Correlation Between G Collado and Desarrolladora Homex

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

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

Diversification Opportunities for G Collado and Desarrolladora Homex

-0.9

Correlation Coefficient

G Collado  Desarrolladora Homex

Pay attention - limited upside

The 3 months correlation between COLLADO and Desarrolladora is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding G Collado SAB and Desarrolladora Homex SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Desarrolladora Homex SAB and G Collado 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 G Collado SAB are associated (or correlated) with Desarrolladora Homex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Desarrolladora Homex SAB has no effect on the direction of G Collado i.e., G Collado and Desarrolladora Homex go up and down completely randomly.

Pair Corralation between G Collado and Desarrolladora Homex

If you would invest  0.10  in Desarrolladora Homex SAB on September 23, 2024 and sell it today you would earn a total of  0.00  from holding Desarrolladora Homex SAB or generate 0.0% return on investment over 90 days.

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

G Collado SAB  vs.  Desarrolladora Homex SAB

G Collado SAB

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in G Collado SAB are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy essential indicators, G Collado is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Desarrolladora Homex SAB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Desarrolladora Homex SAB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with G Collado and Desarrolladora Homex

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

The idea behind G Collado SAB and Desarrolladora Homex 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.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.