Correlation Between Ambev SA and Femasys
Can any of the company-specific risk be diversified away by investing in both Ambev SA and Femasys 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 Ambev SA and Femasys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ambev SA ADR and Femasys, you can compare the effects of market volatilities on Ambev SA and Femasys 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 Ambev SA with a short position of Femasys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambev SA and Femasys.
Diversification Opportunities for Ambev SA and Femasys
Significant diversification
The 3 months correlation between Ambev and Femasys is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Ambev SA ADR and Femasys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Femasys and Ambev SA 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 Ambev SA ADR are associated (or correlated) with Femasys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Femasys has no effect on the direction of Ambev SA i.e., Ambev SA and Femasys go up and down completely randomly.
Pair Corralation between Ambev SA and Femasys
Given the investment horizon of 90 days Ambev SA ADR is expected to under-perform the Femasys. But the stock apears to be less risky and, when comparing its historical volatility, Ambev SA ADR is 11.55 times less risky than Femasys. The stock trades about -0.02 of its potential returns per unit of risk. The Femasys is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 120.00 in Femasys on November 2, 2024 and sell it today you would lose (1.00) from holding Femasys or give up 0.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ambev SA ADR vs. Femasys
Performance |
| Timeline |
| Ambev SA ADR |
| Femasys |
Ambev SA and Femasys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ambev SA and Femasys
The main advantage of trading using opposite Ambev SA and Femasys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambev SA position performs unexpectedly, Femasys 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 Femasys will offset losses from the drop in Femasys' long position.| Ambev SA vs. Fomento Economico Mexicano | Ambev SA vs. Boston Beer | Ambev SA vs. Carlsberg AS | Ambev SA vs. Compania Cervecerias Unidas |
| Femasys vs. Precision Optics, | Femasys vs. Repro Med Systems | Femasys vs. InfuSystems Holdings | Femasys vs. Utah Medical Products |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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