Correlation Between Sumitomo Metal and Grupo Aeroportuario

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

By analyzing existing cross correlation between Sumitomo Metal Mining and Grupo Aeroportuario del, you can compare the effects of market volatilities on Sumitomo Metal and Grupo Aeroportuario 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 Sumitomo Metal with a short position of Grupo Aeroportuario. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sumitomo Metal and Grupo Aeroportuario.

Diversification Opportunities for Sumitomo Metal and Grupo Aeroportuario

0.0

Correlation Coefficient

Sumitomo Metal  Grupo Aeroportuario

Pay attention - limited upside

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

Pair Corralation between Sumitomo Metal and Grupo Aeroportuario

If you would invest  538.00  in Sumitomo Metal Mining on May 7, 2025 and sell it today you would earn a total of  45.00  from holding Sumitomo Metal Mining or generate 8.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Sumitomo Metal Mining  vs.  Grupo Aeroportuario del

Sumitomo Metal Mining

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Sumitomo Metal Mining are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Sumitomo Metal may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Grupo Aeroportuario del

Risk-Adjusted Performance

Soft

Over the last 90 days Grupo Aeroportuario del has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Grupo Aeroportuario is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Sumitomo Metal and Grupo Aeroportuario

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

The idea behind Sumitomo Metal Mining and Grupo Aeroportuario del 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.