Correlation Between Unifin Financiera and Gentera SAB

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

By analyzing existing cross correlation between Unifin Financiera S and Gentera SAB de, you can compare the effects of market volatilities on Unifin Financiera and Gentera SAB 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 Unifin Financiera with a short position of Gentera SAB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unifin Financiera and Gentera SAB.

Diversification Opportunities for Unifin Financiera and Gentera SAB

0.0

Correlation Coefficient

Unifin Financiera  Gentera SAB

Pay attention - limited upside

The 3 months correlation between Unifin and Gentera is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Unifin Financiera S and Gentera SAB de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gentera SAB de and Unifin Financiera 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 Unifin Financiera S are associated (or correlated) with Gentera SAB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gentera SAB de has no effect on the direction of Unifin Financiera i.e., Unifin Financiera and Gentera SAB go up and down completely randomly.

Pair Corralation between Unifin Financiera and Gentera SAB

Assuming the 90 days trading horizon Unifin Financiera S is expected to generate 18.02 times more return on investment than Gentera SAB. However, Unifin Financiera is 18.02 times more volatile than Gentera SAB de. It trades about 0.04 of its potential returns per unit of risk. Gentera SAB de is currently generating about 0.03 per unit of risk. If you would invest  120.00  in Unifin Financiera S on September 24, 2024 and sell it today you would earn a total of  1,080  from holding Unifin Financiera S or generate 900.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Unifin Financiera S  vs.  Gentera SAB de

Unifin Financiera

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Unifin Financiera S has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Unifin Financiera is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Gentera SAB de

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Gentera SAB de are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Gentera SAB sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Unifin Financiera and Gentera SAB

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

The idea behind Unifin Financiera S and Gentera SAB de 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.