Correlation Between FIBRA Macquarie and Fibra Danhos

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

By analyzing existing cross correlation between FIBRA Macquarie Mxico and Fibra Danhos, you can compare the effects of market volatilities on FIBRA Macquarie and Fibra Danhos 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 FIBRA Macquarie with a short position of Fibra Danhos. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIBRA Macquarie and Fibra Danhos.

Diversification Opportunities for FIBRA Macquarie and Fibra Danhos

0.65

Correlation Coefficient

FIBRA Macquarie  Fibra Danhos

Poor diversification

The 3 months correlation between FIBRA and Fibra is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding FIBRA Macquarie Mxico and Fibra Danhos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fibra Danhos and FIBRA Macquarie 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 FIBRA Macquarie Mxico are associated (or correlated) with Fibra Danhos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fibra Danhos has no effect on the direction of FIBRA Macquarie i.e., FIBRA Macquarie and Fibra Danhos go up and down completely randomly.

Pair Corralation between FIBRA Macquarie and Fibra Danhos

Assuming the 90 days trading horizon FIBRA Macquarie is expected to generate 5.22 times less return on investment than Fibra Danhos. But when comparing it to its historical volatility, FIBRA Macquarie Mxico is 1.18 times less risky than Fibra Danhos. It trades about 0.02 of its potential returns per unit of risk. Fibra Danhos is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2,048  in Fibra Danhos on December 25, 2024 and sell it today you would earn a total of  189.00  from holding Fibra Danhos or generate 9.23% return on investment over 90 days.

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

FIBRA Macquarie Mxico  vs.  Fibra Danhos

FIBRA Macquarie Mxico

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in FIBRA Macquarie Mxico are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable primary indicators, FIBRA Macquarie is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Fibra Danhos

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fibra Danhos are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Fibra Danhos may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with FIBRA Macquarie and Fibra Danhos

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

The idea behind FIBRA Macquarie Mxico and Fibra Danhos 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.