Correlation Between IRSA Inversiones and MI Homes

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Can any of the company-specific risk be diversified away by investing in both IRSA Inversiones and MI Homes 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 IRSA Inversiones and MI Homes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IRSA Inversiones Y and MI Homes, you can compare the effects of market volatilities on IRSA Inversiones and MI Homes 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 IRSA Inversiones with a short position of MI Homes. Check out your portfolio center. Please also check ongoing floating volatility patterns of IRSA Inversiones and MI Homes.

Diversification Opportunities for IRSA Inversiones and MI Homes

-0.56
  Correlation Coefficient

Excellent diversification

The 3 months correlation between IRSA and MHO is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding IRSA Inversiones Y and MI Homes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MI Homes and IRSA Inversiones 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 IRSA Inversiones Y are associated (or correlated) with MI Homes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MI Homes has no effect on the direction of IRSA Inversiones i.e., IRSA Inversiones and MI Homes go up and down completely randomly.

Pair Corralation between IRSA Inversiones and MI Homes

Considering the 90-day investment horizon IRSA Inversiones Y is expected to generate 2.36 times more return on investment than MI Homes. However, IRSA Inversiones is 2.36 times more volatile than MI Homes. It trades about 0.08 of its potential returns per unit of risk. MI Homes is currently generating about -0.04 per unit of risk. If you would invest  1,263  in IRSA Inversiones Y on September 3, 2025 and sell it today you would earn a total of  252.00  from holding IRSA Inversiones Y or generate 19.95% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

IRSA Inversiones Y  vs.  MI Homes

 Performance 
       Timeline  
IRSA Inversiones Y 

Risk-Adjusted Performance

Mild

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in IRSA Inversiones Y are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, IRSA Inversiones unveiled solid returns over the last few months and may actually be approaching a breakup point.
MI Homes 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days MI Homes has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical indicators, MI Homes is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

IRSA Inversiones and MI Homes Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with IRSA Inversiones and MI Homes

The main advantage of trading using opposite IRSA Inversiones and MI Homes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IRSA Inversiones position performs unexpectedly, MI Homes 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 MI Homes will offset losses from the drop in MI Homes' long position.
The idea behind IRSA Inversiones Y and MI Homes 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.

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