Correlation Between Bombril SA and Pettenati
Can any of the company-specific risk be diversified away by investing in both Bombril SA and Pettenati 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 Bombril SA and Pettenati into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bombril SA and Pettenati SA Industria, you can compare the effects of market volatilities on Bombril SA and Pettenati 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 Bombril SA with a short position of Pettenati. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bombril SA and Pettenati.
Diversification Opportunities for Bombril SA and Pettenati
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bombril and Pettenati is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Bombril SA and Pettenati SA Industria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pettenati SA Industria and Bombril 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 Bombril SA are associated (or correlated) with Pettenati. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pettenati SA Industria has no effect on the direction of Bombril SA i.e., Bombril SA and Pettenati go up and down completely randomly.
Pair Corralation between Bombril SA and Pettenati
Assuming the 90 days trading horizon Bombril SA is expected to generate 1.25 times more return on investment than Pettenati. However, Bombril SA is 1.25 times more volatile than Pettenati SA Industria. It trades about 0.06 of its potential returns per unit of risk. Pettenati SA Industria is currently generating about 0.02 per unit of risk. If you would invest 114.00 in Bombril SA on September 5, 2024 and sell it today you would earn a total of 100.00 from holding Bombril SA or generate 87.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Bombril SA vs. Pettenati SA Industria
Performance |
| Timeline |
| Bombril SA |
| Pettenati SA Industria |
Bombril SA and Pettenati Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bombril SA and Pettenati
The main advantage of trading using opposite Bombril SA and Pettenati positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bombril SA position performs unexpectedly, Pettenati 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 Pettenati will offset losses from the drop in Pettenati's long position.| Bombril SA vs. Minupar Participaes SA | Bombril SA vs. Grazziotin SA | Bombril SA vs. Banco da Amaznia | Bombril SA vs. Grazziotin SA |
| Pettenati vs. Schulz SA | Pettenati vs. Springs Global Participaes | Pettenati vs. Grazziotin SA | Pettenati vs. Marcopolo SA |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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