Correlation Between Vina Concha and Quinenco

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

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

Diversification Opportunities for Vina Concha and Quinenco

0.84

Correlation Coefficient

Vina Concha  Quinenco

Very poor diversification

The 3 months correlation between Vina and Quinenco is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Vina Concha To and Quinenco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quinenco and Vina Concha 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 Vina Concha To are associated (or correlated) with Quinenco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quinenco has no effect on the direction of Vina Concha i.e., Vina Concha and Quinenco go up and down completely randomly.

Pair Corralation between Vina Concha and Quinenco

Assuming the 90 days trading horizon Vina Concha To is expected to generate 1.09 times more return on investment than Quinenco. However, Vina Concha is 1.09 times more volatile than Quinenco. It trades about 0.2 of its potential returns per unit of risk. Quinenco is currently generating about 0.17 per unit of risk. If you would invest  108,095  in Vina Concha To on December 27, 2024 and sell it today you would earn a total of  17,205  from holding Vina Concha To or generate 15.92% return on investment over 90 days.

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

Vina Concha To  vs.  Quinenco

Vina Concha To

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vina Concha To are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Vina Concha unveiled solid returns over the last few months and may actually be approaching a breakup point.

Quinenco

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Quinenco are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Quinenco may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Vina Concha and Quinenco

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

The idea behind Vina Concha To and Quinenco 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.