Correlation Between Alupar Investimento and Duke Energy
Can any of the company-specific risk be diversified away by investing in both Alupar Investimento and Duke Energy 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 Alupar Investimento and Duke Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alupar Investimento SA and Duke Energy, you can compare the effects of market volatilities on Alupar Investimento and Duke Energy 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 Alupar Investimento with a short position of Duke Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alupar Investimento and Duke Energy.
Diversification Opportunities for Alupar Investimento and Duke Energy
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alupar and Duke is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Alupar Investimento SA and Duke Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duke Energy and Alupar Investimento 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 Alupar Investimento SA are associated (or correlated) with Duke Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duke Energy has no effect on the direction of Alupar Investimento i.e., Alupar Investimento and Duke Energy go up and down completely randomly.
Pair Corralation between Alupar Investimento and Duke Energy
Assuming the 90 days trading horizon Alupar Investimento SA is expected to under-perform the Duke Energy. But the stock apears to be less risky and, when comparing its historical volatility, Alupar Investimento SA is 1.46 times less risky than Duke Energy. The stock trades about -0.14 of its potential returns per unit of risk. The Duke Energy is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 65,224 in Duke Energy on September 4, 2024 and sell it today you would earn a total of 4,776 from holding Duke Energy or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Alupar Investimento SA vs. Duke Energy
Performance |
| Timeline |
| Alupar Investimento |
| Duke Energy |
Alupar Investimento and Duke Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alupar Investimento and Duke Energy
The main advantage of trading using opposite Alupar Investimento and Duke Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alupar Investimento position performs unexpectedly, Duke Energy 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 Duke Energy will offset losses from the drop in Duke Energy's long position.| Alupar Investimento vs. Sumitomo Mitsui Financial | Alupar Investimento vs. Credit Acceptance | Alupar Investimento vs. Charter Communications | Alupar Investimento vs. Broadcom |
| Duke Energy vs. Unifique Telecomunicaes SA | Duke Energy vs. Global X Funds | Duke Energy vs. MAHLE Metal Leve | Duke Energy vs. Zoom Video Communications |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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