Correlation Between Mapfre and Proeduca Altus

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

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

Diversification Opportunities for Mapfre and Proeduca Altus

0.34

Correlation Coefficient

Mapfre  Proeduca Altus

Weak diversification

The 3 months correlation between Mapfre and Proeduca is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Mapfre and Proeduca Altus SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proeduca Altus SA and Mapfre 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 Mapfre are associated (or correlated) with Proeduca Altus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Proeduca Altus SA has no effect on the direction of Mapfre i.e., Mapfre and Proeduca Altus go up and down completely randomly.

Pair Corralation between Mapfre and Proeduca Altus

Assuming the 90 days trading horizon Mapfre is expected to generate 3.14 times more return on investment than Proeduca Altus. However, Mapfre is 3.14 times more volatile than Proeduca Altus SA. It trades about 0.19 of its potential returns per unit of risk. Proeduca Altus SA is currently generating about -0.05 per unit of risk. If you would invest  309.00  in Mapfre on May 2, 2025 and sell it today you would earn a total of  48.00  from holding Mapfre or generate 15.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	92.31%
Values	Daily Returns

Mapfre  vs.  Proeduca Altus SA

Mapfre

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mapfre are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Mapfre exhibited solid returns over the last few months and may actually be approaching a breakup point.

Proeduca Altus SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Proeduca Altus SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Proeduca Altus is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Mapfre and Proeduca Altus

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

The idea behind Mapfre and Proeduca Altus 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.