Correlation Between BB Seguridade and Athene Holding
Can any of the company-specific risk be diversified away by investing in both BB Seguridade and Athene Holding 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 Seguridade and Athene Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BB Seguridade Participacoes and Athene Holding, you can compare the effects of market volatilities on BB Seguridade and Athene Holding 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 Seguridade with a short position of Athene Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of BB Seguridade and Athene Holding.
Diversification Opportunities for BB Seguridade and Athene Holding
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BBSEY and Athene is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding BB Seguridade Participacoes and Athene Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athene Holding and BB Seguridade 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 Seguridade Participacoes are associated (or correlated) with Athene Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athene Holding has no effect on the direction of BB Seguridade i.e., BB Seguridade and Athene Holding go up and down completely randomly.
Pair Corralation between BB Seguridade and Athene Holding
Assuming the 90 days horizon BB Seguridade Participacoes is expected to under-perform the Athene Holding. In addition to that, BB Seguridade is 4.98 times more volatile than Athene Holding. It trades about -0.17 of its total potential returns per unit of risk. Athene Holding is currently generating about 0.11 per unit of volatility. If you would invest 2,475 in Athene Holding on September 2, 2024 and sell it today you would earn a total of 55.00 from holding Athene Holding or generate 2.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BB Seguridade Participacoes vs. Athene Holding
Performance |
| Timeline |
| BB Seguridade Partic |
| Athene Holding |
BB Seguridade and Athene Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BB Seguridade and Athene Holding
The main advantage of trading using opposite BB Seguridade and Athene Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BB Seguridade position performs unexpectedly, Athene Holding 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 Athene Holding will offset losses from the drop in Athene Holding's long position.| BB Seguridade vs. ageas SANV | BB Seguridade vs. Athene Holding | BB Seguridade vs. Sampo OYJ | BB Seguridade vs. Athene Holding |
| Athene Holding vs. Athene Holding | Athene Holding vs. Athene Holding | Athene Holding vs. Athene Holding | Athene Holding vs. Argo Group International |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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