Correlation Between Compania and Intel Corp

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

By analyzing existing cross correlation between Compania de Transporte and Intel Corp CEDEAR, you can compare the effects of market volatilities on Compania and Intel Corp 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 Compania with a short position of Intel Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compania and Intel Corp.

Diversification Opportunities for Compania and Intel Corp

-0.37

Correlation Coefficient

Compania  Intel Corp

Very good diversification

The 3 months correlation between Compania and Intel is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Compania de Transporte and Intel Corp CEDEAR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel Corp CEDEAR and Compania 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 Compania de Transporte are associated (or correlated) with Intel Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel Corp CEDEAR has no effect on the direction of Compania i.e., Compania and Intel Corp go up and down completely randomly.

Pair Corralation between Compania and Intel Corp

Assuming the 90 days trading horizon Compania de Transporte is expected to generate 1.39 times more return on investment than Intel Corp. However, Compania is 1.39 times more volatile than Intel Corp CEDEAR. It trades about 0.09 of its potential returns per unit of risk. Intel Corp CEDEAR is currently generating about 0.03 per unit of risk. If you would invest  227,000  in Compania de Transporte on May 10, 2025 and sell it today you would earn a total of  38,500  from holding Compania de Transporte or generate 16.96% return on investment over 90 days.

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

Compania de Transporte  vs.  Intel Corp CEDEAR

Compania de Transporte

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Compania de Transporte are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Compania sustained solid returns over the last few months and may actually be approaching a breakup point.

Intel Corp CEDEAR

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Intel Corp CEDEAR are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Intel Corp is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Compania and Intel Corp

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

The idea behind Compania de Transporte and Intel Corp CEDEAR 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.