Correlation Between Corning Incorporated and Grupo Simec

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

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

Diversification Opportunities for Corning Incorporated and Grupo Simec

-0.44

Correlation Coefficient

Corning Incorporated  Grupo Simec

Very good diversification

The 3 months correlation between Corning and Grupo is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Corning Incorporated and Grupo Simec SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Simec SAB and Corning Incorporated 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 Corning Incorporated are associated (or correlated) with Grupo Simec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Simec SAB has no effect on the direction of Corning Incorporated i.e., Corning Incorporated and Grupo Simec go up and down completely randomly.

Pair Corralation between Corning Incorporated and Grupo Simec

Considering the 90-day investment horizon Corning Incorporated is expected to generate 0.47 times more return on investment than Grupo Simec. However, Corning Incorporated is 2.14 times less risky than Grupo Simec. It trades about 0.06 of its potential returns per unit of risk. Grupo Simec SAB is currently generating about 0.0 per unit of risk. If you would invest  3,245  in Corning Incorporated on October 22, 2024 and sell it today you would earn a total of  1,739  from holding Corning Incorporated or generate 53.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	88.48%
Values	Daily Returns

Corning Incorporated  vs.  Grupo Simec SAB

Corning Incorporated

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Corning Incorporated are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain essential indicators, Corning Incorporated may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Grupo Simec SAB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Grupo Simec SAB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's forward indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Corning Incorporated and Grupo Simec

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

The idea behind Corning Incorporated and Grupo Simec 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.

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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.