Correlation Between Braskem SA and 06368LGV2
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By analyzing existing cross correlation between Braskem SA Class and BMO 5203 01 FEB 28, you can compare the effects of market volatilities on Braskem SA and 06368LGV2 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 Braskem SA with a short position of 06368LGV2. Check out your portfolio center. Please also check ongoing floating volatility patterns of Braskem SA and 06368LGV2.
Diversification Opportunities for Braskem SA and 06368LGV2
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Braskem and 06368LGV2 is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Braskem SA Class and BMO 5203 01 FEB 28 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO 5203 01 and Braskem 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 Braskem SA Class are associated (or correlated) with 06368LGV2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO 5203 01 has no effect on the direction of Braskem SA i.e., Braskem SA and 06368LGV2 go up and down completely randomly.
Pair Corralation between Braskem SA and 06368LGV2
Considering the 90-day investment horizon Braskem SA Class is expected to under-perform the 06368LGV2. In addition to that, Braskem SA is 8.9 times more volatile than BMO 5203 01 FEB 28. It trades about -0.36 of its total potential returns per unit of risk. BMO 5203 01 FEB 28 is currently generating about -0.25 per unit of volatility. If you would invest 10,310 in BMO 5203 01 FEB 28 on August 30, 2024 and sell it today you would lose (273.00) from holding BMO 5203 01 FEB 28 or give up 2.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Braskem SA Class vs. BMO 5203 01 FEB 28
Performance |
| Timeline |
| Braskem SA Class |
| BMO 5203 01 |
Braskem SA and 06368LGV2 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Braskem SA and 06368LGV2
The main advantage of trading using opposite Braskem SA and 06368LGV2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Braskem SA position performs unexpectedly, 06368LGV2 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 06368LGV2 will offset losses from the drop in 06368LGV2's long position.| Braskem SA vs. Valhi Inc | Braskem SA vs. Huntsman | Braskem SA vs. Lsb Industries | Braskem SA vs. Westlake Chemical Partners |
| 06368LGV2 vs. BioNTech SE | 06368LGV2 vs. Ihuman Inc | 06368LGV2 vs. Tarsus Pharmaceuticals | 06368LGV2 vs. Lipocine |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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