Correlation Between Turism Hotelur and Electromagnetica

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

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

Diversification Opportunities for Turism Hotelur and Electromagnetica

0.0

Correlation Coefficient

Turism Hotelur  Electromagnetica

Pay attention - limited upside

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

Pair Corralation between Turism Hotelur and Electromagnetica

Assuming the 90 days trading horizon Turism Hotelur is expected to generate 6.07 times less return on investment than Electromagnetica. In addition to that, Turism Hotelur is 1.51 times more volatile than Electromagnetica SA. It trades about 0.01 of its total potential returns per unit of risk. Electromagnetica SA is currently generating about 0.13 per unit of volatility. If you would invest  20.00  in Electromagnetica SA on September 27, 2024 and sell it today you would earn a total of  1.00  from holding Electromagnetica SA or generate 5.0% return on investment over 90 days.

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

Turism Hotelur  vs.  Electromagnetica SA

Turism Hotelur

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Turism Hotelur are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Turism Hotelur may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Electromagnetica

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Electromagnetica SA are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Electromagnetica may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Turism Hotelur and Electromagnetica

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

The idea behind Turism Hotelur and Electromagnetica 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.

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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.