Correlation Between BTG Pactual and FDO INV
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and FDO INV 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 BTG Pactual and FDO INV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BTG Pactual Logstica and FDO INV CAD, you can compare the effects of market volatilities on BTG Pactual and FDO INV 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 BTG Pactual with a short position of FDO INV. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and FDO INV.
Diversification Opportunities for BTG Pactual and FDO INV
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BTG and FDO is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and FDO INV CAD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FDO INV CAD and BTG Pactual 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 BTG Pactual Logstica are associated (or correlated) with FDO INV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FDO INV CAD has no effect on the direction of BTG Pactual i.e., BTG Pactual and FDO INV go up and down completely randomly.
Pair Corralation between BTG Pactual and FDO INV
Assuming the 90 days trading horizon BTG Pactual is expected to generate 20.7 times less return on investment than FDO INV. But when comparing it to its historical volatility, BTG Pactual Logstica is 4.47 times less risky than FDO INV. It trades about 0.01 of its potential returns per unit of risk. FDO INV CAD is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 768.00 in FDO INV CAD on August 30, 2024 and sell it today you would earn a total of 21.00 from holding FDO INV CAD or generate 2.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
BTG Pactual Logstica vs. FDO INV CAD
Performance |
| Timeline |
| BTG Pactual Logstica |
| FDO INV CAD |
BTG Pactual and FDO INV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and FDO INV
The main advantage of trading using opposite BTG Pactual and FDO INV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, FDO INV 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 FDO INV will offset losses from the drop in FDO INV's long position.| BTG Pactual vs. Fundo Investimento Imobiliario | BTG Pactual vs. KILIMA VOLKANO RECEBVEIS | BTG Pactual vs. DEVANT PROPERTIES FUNDO | BTG Pactual vs. SPARTA FIAGRO FDO |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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