Correlation Between Minerva SA and ATMA Participaes
Can any of the company-specific risk be diversified away by investing in both Minerva SA and ATMA Participaes 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 Minerva SA and ATMA Participaes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Minerva SA and ATMA Participaes SA, you can compare the effects of market volatilities on Minerva SA and ATMA Participaes 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 Minerva SA with a short position of ATMA Participaes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Minerva SA and ATMA Participaes.
Diversification Opportunities for Minerva SA and ATMA Participaes
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Minerva and ATMA is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Minerva SA and ATMA Participaes SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATMA Participaes and Minerva 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 Minerva SA are associated (or correlated) with ATMA Participaes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATMA Participaes has no effect on the direction of Minerva SA i.e., Minerva SA and ATMA Participaes go up and down completely randomly.
Pair Corralation between Minerva SA and ATMA Participaes
Assuming the 90 days trading horizon Minerva SA is expected to under-perform the ATMA Participaes. But the stock apears to be less risky and, when comparing its historical volatility, Minerva SA is 2.07 times less risky than ATMA Participaes. The stock trades about -0.06 of its potential returns per unit of risk. The ATMA Participaes SA is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 96.00 in ATMA Participaes SA on August 27, 2024 and sell it today you would earn a total of 34.00 from holding ATMA Participaes SA or generate 35.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Minerva SA vs. ATMA Participaes SA
Performance |
| Timeline |
| Minerva SA |
| ATMA Participaes |
Minerva SA and ATMA Participaes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Minerva SA and ATMA Participaes
The main advantage of trading using opposite Minerva SA and ATMA Participaes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Minerva SA position performs unexpectedly, ATMA Participaes 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 ATMA Participaes will offset losses from the drop in ATMA Participaes' long position.| Minerva SA vs. Marfrig Global Foods | Minerva SA vs. JBS SA | Minerva SA vs. BRF SA | Minerva SA vs. SLC Agrcola SA |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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