Correlation Between Ambev SA and Paragon Shipping
Can any of the company-specific risk be diversified away by investing in both Ambev SA and Paragon Shipping 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 Paragon Shipping 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 Paragon Shipping, you can compare the effects of market volatilities on Ambev SA and Paragon Shipping 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 Paragon Shipping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambev SA and Paragon Shipping.
Diversification Opportunities for Ambev SA and Paragon Shipping
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ambev and Paragon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ambev SA ADR and Paragon Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paragon Shipping 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 Paragon Shipping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paragon Shipping has no effect on the direction of Ambev SA i.e., Ambev SA and Paragon Shipping go up and down completely randomly.
Pair Corralation between Ambev SA and Paragon Shipping
If you would invest 0.01 in Paragon Shipping on August 24, 2024 and sell it today you would earn a total of 0.00 from holding Paragon Shipping or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 8.87% |
| Values | Daily Returns |
Ambev SA ADR vs. Paragon Shipping
Performance |
| Timeline |
| Ambev SA ADR |
| Paragon Shipping |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ambev SA and Paragon Shipping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ambev SA and Paragon Shipping
The main advantage of trading using opposite Ambev SA and Paragon Shipping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambev SA position performs unexpectedly, Paragon Shipping 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 Paragon Shipping will offset losses from the drop in Paragon Shipping's long position.| Ambev SA vs. Fomento Economico Mexicano | Ambev SA vs. Boston Beer | Ambev SA vs. Carlsberg AS | Ambev SA vs. Compania Cervecerias Unidas |
| Paragon Shipping vs. Celsius Holdings | Paragon Shipping vs. Boston Beer | Paragon Shipping vs. Ambev SA ADR | Paragon Shipping vs. Anheuser Busch Inbev |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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