Correlation Between InRetail Peru and Intel

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

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

Diversification Opportunities for InRetail Peru and Intel

0.44

Correlation Coefficient

InRetail Peru  Intel

Very weak diversification

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

Pair Corralation between InRetail Peru and Intel

Assuming the 90 days trading horizon InRetail Peru Corp is expected to generate 0.36 times more return on investment than Intel. However, InRetail Peru Corp is 2.8 times less risky than Intel. It trades about 0.21 of its potential returns per unit of risk. Intel is currently generating about -0.05 per unit of risk. If you would invest  3,090  in InRetail Peru Corp on October 11, 2024 and sell it today you would earn a total of  80.00  from holding InRetail Peru Corp or generate 2.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	85.71%
Values	Daily Returns

InRetail Peru Corp  vs.  Intel

InRetail Peru Corp

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in InRetail Peru Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, InRetail Peru is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Intel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intel has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with InRetail Peru and Intel

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

The idea behind InRetail Peru Corp and Intel 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.