Correlation Between Grupo Bimbo and Rjd Green

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

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

Diversification Opportunities for Grupo Bimbo and Rjd Green

0.73

Correlation Coefficient

Grupo Bimbo  Rjd Green

Poor diversification

The 3 months correlation between Grupo and Rjd is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Bimbo SAB and Rjd Green in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rjd Green and Grupo Bimbo 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 Grupo Bimbo SAB are associated (or correlated) with Rjd Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rjd Green has no effect on the direction of Grupo Bimbo i.e., Grupo Bimbo and Rjd Green go up and down completely randomly.

Pair Corralation between Grupo Bimbo and Rjd Green

Assuming the 90 days horizon Grupo Bimbo SAB is expected to generate 0.57 times more return on investment than Rjd Green. However, Grupo Bimbo SAB is 1.75 times less risky than Rjd Green. It trades about -0.06 of its potential returns per unit of risk. Rjd Green is currently generating about -0.1 per unit of risk. If you would invest  350.00  in Grupo Bimbo SAB on September 5, 2024 and sell it today you would lose (50.00) from holding Grupo Bimbo SAB or give up 14.29% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Grupo Bimbo SAB  vs.  Rjd Green

Grupo Bimbo SAB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Grupo Bimbo SAB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's primary indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Rjd Green

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rjd Green has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Grupo Bimbo and Rjd Green

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

The idea behind Grupo Bimbo SAB and Rjd Green 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.