Correlation Between B3 SA and BTG Pactual
Can any of the company-specific risk be diversified away by investing in both B3 SA and BTG Pactual 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 B3 SA and BTG Pactual into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between B3 SA and BTG Pactual Logstica, you can compare the effects of market volatilities on B3 SA and BTG Pactual 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 B3 SA with a short position of BTG Pactual. Check out your portfolio center. Please also check ongoing floating volatility patterns of B3 SA and BTG Pactual.
Diversification Opportunities for B3 SA and BTG Pactual
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between B3SA3 and BTG is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding B3 SA and BTG Pactual Logstica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTG Pactual Logstica and B3 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 B3 SA are associated (or correlated) with BTG Pactual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTG Pactual Logstica has no effect on the direction of B3 SA i.e., B3 SA and BTG Pactual go up and down completely randomly.
Pair Corralation between B3 SA and BTG Pactual
Assuming the 90 days trading horizon B3 SA is expected to under-perform the BTG Pactual. In addition to that, B3 SA is 2.78 times more volatile than BTG Pactual Logstica. It trades about -0.07 of its total potential returns per unit of risk. BTG Pactual Logstica is currently generating about -0.03 per unit of volatility. If you would invest 10,033 in BTG Pactual Logstica on September 2, 2024 and sell it today you would lose (533.00) from holding BTG Pactual Logstica or give up 5.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
B3 SA vs. BTG Pactual Logstica
Performance |
| Timeline |
| B3 SA |
| BTG Pactual Logstica |
B3 SA and BTG Pactual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with B3 SA and BTG Pactual
The main advantage of trading using opposite B3 SA and BTG Pactual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if B3 SA position performs unexpectedly, BTG Pactual 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 BTG Pactual will offset losses from the drop in BTG Pactual's long position.| B3 SA vs. Banco Bradesco SA | B3 SA vs. Petrleo Brasileiro SA | B3 SA vs. Ita Unibanco Holding | B3 SA vs. Itasa Investimentos |
| BTG Pactual vs. Plano Plano Desenvolvimento | BTG Pactual vs. Cable One | BTG Pactual vs. ATMA Participaes SA | BTG Pactual vs. British American Tobacco |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |