Correlation Between BTG Pactual and Trend ETF
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and Trend ETF 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 Trend ETF 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 Trend ETF Ibovespa, you can compare the effects of market volatilities on BTG Pactual and Trend ETF 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 Trend ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and Trend ETF.
Diversification Opportunities for BTG Pactual and Trend ETF
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BTG and Trend is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and Trend ETF Ibovespa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trend ETF Ibovespa 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 Trend ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trend ETF Ibovespa has no effect on the direction of BTG Pactual i.e., BTG Pactual and Trend ETF go up and down completely randomly.
Pair Corralation between BTG Pactual and Trend ETF
Assuming the 90 days trading horizon BTG Pactual Logstica is expected to under-perform the Trend ETF. In addition to that, BTG Pactual is 1.69 times more volatile than Trend ETF Ibovespa. It trades about -0.17 of its total potential returns per unit of risk. Trend ETF Ibovespa is currently generating about 0.06 per unit of volatility. If you would invest 1,298 in Trend ETF Ibovespa on September 13, 2024 and sell it today you would earn a total of 16.00 from holding Trend ETF Ibovespa or generate 1.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTG Pactual Logstica vs. Trend ETF Ibovespa
Performance |
| Timeline |
| BTG Pactual Logstica |
| Trend ETF Ibovespa |
BTG Pactual and Trend ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and Trend ETF
The main advantage of trading using opposite BTG Pactual and Trend ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, Trend ETF 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 Trend ETF will offset losses from the drop in Trend ETF'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 |
| Trend ETF vs. Trend Etf Crsp | Trend ETF vs. Trend Etf Msci | Trend ETF vs. Trend Etf Lbma | Trend ETF vs. Trend Etf Ifix |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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