Correlation Between Aura Minerals and Magazine Luiza
Can any of the company-specific risk be diversified away by investing in both Aura Minerals and Magazine Luiza 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 Aura Minerals and Magazine Luiza into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aura Minerals and Magazine Luiza SA, you can compare the effects of market volatilities on Aura Minerals and Magazine Luiza 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 Aura Minerals with a short position of Magazine Luiza. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aura Minerals and Magazine Luiza.
Diversification Opportunities for Aura Minerals and Magazine Luiza
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aura and Magazine is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Aura Minerals and Magazine Luiza SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magazine Luiza SA and Aura Minerals 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 Aura Minerals are associated (or correlated) with Magazine Luiza. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magazine Luiza SA has no effect on the direction of Aura Minerals i.e., Aura Minerals and Magazine Luiza go up and down completely randomly.
Pair Corralation between Aura Minerals and Magazine Luiza
Assuming the 90 days trading horizon Aura Minerals is expected to generate 0.76 times more return on investment than Magazine Luiza. However, Aura Minerals is 1.31 times less risky than Magazine Luiza. It trades about 0.12 of its potential returns per unit of risk. Magazine Luiza SA is currently generating about 0.02 per unit of risk. If you would invest 2,275 in Aura Minerals on August 24, 2024 and sell it today you would earn a total of 150.00 from holding Aura Minerals or generate 6.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aura Minerals vs. Magazine Luiza SA
Performance |
| Timeline |
| Aura Minerals |
| Magazine Luiza SA |
Aura Minerals and Magazine Luiza Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aura Minerals and Magazine Luiza
The main advantage of trading using opposite Aura Minerals and Magazine Luiza positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aura Minerals position performs unexpectedly, Magazine Luiza 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 Magazine Luiza will offset losses from the drop in Magazine Luiza's long position.| Aura Minerals vs. Ambipar Participaes e | Aura Minerals vs. BrasilAgro Companhia | Aura Minerals vs. Mliuz SA | Aura Minerals vs. Irani Papel e |
| Magazine Luiza vs. Baidu Inc | Magazine Luiza vs. Deutsche Bank Aktiengesellschaft | Magazine Luiza vs. HSBC Holdings plc | Magazine Luiza vs. The Bank of |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |