Correlation Between FIBRA Macquarie and Fibra UNO

Can any of the company-specific risk be diversified away by investing in both FIBRA Macquarie and Fibra UNO 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 UNO 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 UNO, you can compare the effects of market volatilities on FIBRA Macquarie and Fibra UNO 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 UNO. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIBRA Macquarie and Fibra UNO.

Diversification Opportunities for FIBRA Macquarie and Fibra UNO

0.78

Correlation Coefficient

FIBRA Macquarie  Fibra UNO

Poor diversification

The 3 months correlation between FIBRA and Fibra is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding FIBRA Macquarie Mxico and Fibra UNO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fibra UNO 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 UNO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fibra UNO has no effect on the direction of FIBRA Macquarie i.e., FIBRA Macquarie and Fibra UNO go up and down completely randomly.

Pair Corralation between FIBRA Macquarie and Fibra UNO

Assuming the 90 days trading horizon FIBRA Macquarie Mxico is expected to under-perform the Fibra UNO. In addition to that, FIBRA Macquarie is 1.18 times more volatile than Fibra UNO. It trades about -0.05 of its total potential returns per unit of risk. Fibra UNO is currently generating about -0.01 per unit of volatility. If you would invest  2,151  in Fibra UNO on October 26, 2024 and sell it today you would lose (21.00) from holding Fibra UNO or give up 0.98% of portfolio value over 90 days.

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

FIBRA Macquarie Mxico  vs.  Fibra UNO

FIBRA Macquarie Mxico

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FIBRA Macquarie Mxico has generated negative risk-adjusted returns adding no value to investors with long positions. 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 UNO

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fibra UNO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with FIBRA Macquarie and Fibra UNO

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

The idea behind FIBRA Macquarie Mxico and Fibra UNO 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.