Correlation Between GRUPO CARSO and Pure Storage

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

By analyzing existing cross correlation between GRUPO CARSO A1 and Pure Storage, you can compare the effects of market volatilities on GRUPO CARSO and Pure Storage 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 CARSO with a short position of Pure Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRUPO CARSO and Pure Storage.

Diversification Opportunities for GRUPO CARSO and Pure Storage

0.17

Correlation Coefficient

GRUPO CARSO  Pure Storage

Average diversification

The 3 months correlation between GRUPO and Pure is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding GRUPO CARSO A1 and Pure Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pure Storage and GRUPO CARSO 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 CARSO A1 are associated (or correlated) with Pure Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pure Storage has no effect on the direction of GRUPO CARSO i.e., GRUPO CARSO and Pure Storage go up and down completely randomly.

Pair Corralation between GRUPO CARSO and Pure Storage

Assuming the 90 days trading horizon GRUPO CARSO is expected to generate 4.93 times less return on investment than Pure Storage. In addition to that, GRUPO CARSO is 1.03 times more volatile than Pure Storage. It trades about 0.03 of its total potential returns per unit of risk. Pure Storage is currently generating about 0.13 per unit of volatility. If you would invest  4,438  in Pure Storage on September 24, 2024 and sell it today you would earn a total of  1,523  from holding Pure Storage or generate 34.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

GRUPO CARSO A1  vs.  Pure Storage

GRUPO CARSO A1

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in GRUPO CARSO A1 are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, GRUPO CARSO may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pure Storage

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pure Storage are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Pure Storage reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GRUPO CARSO and Pure Storage

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

The idea behind GRUPO CARSO A1 and Pure Storage 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.