Correlation Between Marisa Lojas and CA Modas
Can any of the company-specific risk be diversified away by investing in both Marisa Lojas and CA Modas 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 Marisa Lojas and CA Modas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marisa Lojas SA and CA Modas SA, you can compare the effects of market volatilities on Marisa Lojas and CA Modas 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 Marisa Lojas with a short position of CA Modas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marisa Lojas and CA Modas.
Diversification Opportunities for Marisa Lojas and CA Modas
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Marisa and CEAB3 is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Marisa Lojas SA and CA Modas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CA Modas SA and Marisa Lojas 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 Marisa Lojas SA are associated (or correlated) with CA Modas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CA Modas SA has no effect on the direction of Marisa Lojas i.e., Marisa Lojas and CA Modas go up and down completely randomly.
Pair Corralation between Marisa Lojas and CA Modas
Assuming the 90 days trading horizon Marisa Lojas SA is expected to generate 0.59 times more return on investment than CA Modas. However, Marisa Lojas SA is 1.71 times less risky than CA Modas. It trades about -0.07 of its potential returns per unit of risk. CA Modas SA is currently generating about -0.2 per unit of risk. If you would invest 96.00 in Marisa Lojas SA on August 31, 2024 and sell it today you would lose (5.00) from holding Marisa Lojas SA or give up 5.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marisa Lojas SA vs. CA Modas SA
Performance |
| Timeline |
| Marisa Lojas SA |
| CA Modas SA |
Marisa Lojas and CA Modas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marisa Lojas and CA Modas
The main advantage of trading using opposite Marisa Lojas and CA Modas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marisa Lojas position performs unexpectedly, CA Modas 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 CA Modas will offset losses from the drop in CA Modas' long position.| Marisa Lojas vs. Lojas Renner SA | Marisa Lojas vs. Guararapes Confeces SA | Marisa Lojas vs. CA Modas SA | Marisa Lojas vs. Minerva SA |
| CA Modas vs. Marisa Lojas SA | CA Modas vs. Vivara Participaes SA | CA Modas vs. Guararapes Confeces SA | CA Modas vs. Atacado SA |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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