Correlation Between BB Renda and Fundo Investimento
Can any of the company-specific risk be diversified away by investing in both BB Renda and Fundo Investimento 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 BB Renda and Fundo Investimento into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BB Renda Corporativa and Fundo Investimento Imobiliario, you can compare the effects of market volatilities on BB Renda and Fundo Investimento 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 BB Renda with a short position of Fundo Investimento. Check out your portfolio center. Please also check ongoing floating volatility patterns of BB Renda and Fundo Investimento.
Diversification Opportunities for BB Renda and Fundo Investimento
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between BBRC11 and Fundo is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding BB Renda Corporativa and Fundo Investimento Imobiliario in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fundo Investimento and BB Renda 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 BB Renda Corporativa are associated (or correlated) with Fundo Investimento. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fundo Investimento has no effect on the direction of BB Renda i.e., BB Renda and Fundo Investimento go up and down completely randomly.
Pair Corralation between BB Renda and Fundo Investimento
Assuming the 90 days trading horizon BB Renda Corporativa is expected to generate 0.99 times more return on investment than Fundo Investimento. However, BB Renda Corporativa is 1.01 times less risky than Fundo Investimento. It trades about 0.05 of its potential returns per unit of risk. Fundo Investimento Imobiliario is currently generating about 0.01 per unit of risk. If you would invest 8,613 in BB Renda Corporativa on August 30, 2024 and sell it today you would earn a total of 2,150 from holding BB Renda Corporativa or generate 24.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BB Renda Corporativa vs. Fundo Investimento Imobiliario
Performance |
| Timeline |
| BB Renda Corporativa |
| Fundo Investimento |
BB Renda and Fundo Investimento Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BB Renda and Fundo Investimento
The main advantage of trading using opposite BB Renda and Fundo Investimento positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BB Renda position performs unexpectedly, Fundo Investimento 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 Fundo Investimento will offset losses from the drop in Fundo Investimento's long position.| BB Renda vs. BTG Pactual Logstica | BB Renda vs. Fundo Investimento Imobiliario | BB Renda vs. KILIMA VOLKANO RECEBVEIS | BB Renda vs. DEVANT PROPERTIES FUNDO |
| Fundo Investimento vs. Fundo De Investimentos | Fundo Investimento vs. Fundo Invest Imobiliario | Fundo Investimento vs. Fundo de Investimento | Fundo Investimento vs. Fundo Investec IMB |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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