Correlation Between YPF SA and Grupo Supervielle

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

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

Diversification Opportunities for YPF SA and Grupo Supervielle

0.81

Correlation Coefficient

YPF SA  Grupo Supervielle

Very poor diversification

The 3 months correlation between YPF and Grupo is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding YPF SA D and Grupo Supervielle SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Supervielle and YPF SA 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 YPF SA D are associated (or correlated) with Grupo Supervielle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Supervielle has no effect on the direction of YPF SA i.e., YPF SA and Grupo Supervielle go up and down completely randomly.

Pair Corralation between YPF SA and Grupo Supervielle

Assuming the 90 days trading horizon YPF SA D is expected to generate 0.99 times more return on investment than Grupo Supervielle. However, YPF SA D is 1.01 times less risky than Grupo Supervielle. It trades about 0.23 of its potential returns per unit of risk. Grupo Supervielle SA is currently generating about 0.18 per unit of risk. If you would invest  3,062,500  in YPF SA D on August 30, 2024 and sell it today you would earn a total of  1,322,500  from holding YPF SA D or generate 43.18% return on investment over 90 days.

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

YPF SA D  vs.  Grupo Supervielle SA

YPF SA D

Risk-Adjusted Performance

0 of 100

Solid

Over the last 90 days YPF SA D has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat weak basic indicators, YPF SA sustained solid returns over the last few months and may actually be approaching a breakup point.

Grupo Supervielle

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Grupo Supervielle SA are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Grupo Supervielle sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with YPF SA and Grupo Supervielle

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

The idea behind YPF SA D and Grupo Supervielle 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.

Check out your portfolio center.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.