Correlation Between Sociedad Matriz and Enjoy SA

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

By analyzing existing cross correlation between Sociedad Matriz SAAM and Enjoy SA, you can compare the effects of market volatilities on Sociedad Matriz and Enjoy SA 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 Sociedad Matriz with a short position of Enjoy SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sociedad Matriz and Enjoy SA.

Diversification Opportunities for Sociedad Matriz and Enjoy SA

-0.76

Correlation Coefficient

Sociedad Matriz  Enjoy SA

Pay attention - limited upside

The 3 months correlation between Sociedad and Enjoy is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Sociedad Matriz SAAM and Enjoy SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enjoy SA and Sociedad Matriz 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 Sociedad Matriz SAAM are associated (or correlated) with Enjoy SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enjoy SA has no effect on the direction of Sociedad Matriz i.e., Sociedad Matriz and Enjoy SA go up and down completely randomly.

Pair Corralation between Sociedad Matriz and Enjoy SA

Assuming the 90 days trading horizon Sociedad Matriz SAAM is expected to generate 0.29 times more return on investment than Enjoy SA. However, Sociedad Matriz SAAM is 3.39 times less risky than Enjoy SA. It trades about 0.11 of its potential returns per unit of risk. Enjoy SA is currently generating about -0.2 per unit of risk. If you would invest  10,196  in Sociedad Matriz SAAM on December 3, 2024 and sell it today you would earn a total of  487.00  from holding Sociedad Matriz SAAM or generate 4.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Sociedad Matriz SAAM  vs.  Enjoy SA

Sociedad Matriz SAAM

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sociedad Matriz SAAM are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Sociedad Matriz is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Enjoy SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Enjoy SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Sociedad Matriz and Enjoy SA

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

The idea behind Sociedad Matriz SAAM and Enjoy SA 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.