Correlation Between BTG Pactual and FDO DE
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and FDO DE 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 DE 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 DE INVEST, you can compare the effects of market volatilities on BTG Pactual and FDO DE 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 DE. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and FDO DE.
Diversification Opportunities for BTG Pactual and FDO DE
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BTG and FDO is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and FDO DE INVEST in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FDO DE INVEST 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 DE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FDO DE INVEST has no effect on the direction of BTG Pactual i.e., BTG Pactual and FDO DE go up and down completely randomly.
Pair Corralation between BTG Pactual and FDO DE
Assuming the 90 days trading horizon BTG Pactual Logstica is expected to generate 1.13 times more return on investment than FDO DE. However, BTG Pactual is 1.13 times more volatile than FDO DE INVEST. It trades about 0.02 of its potential returns per unit of risk. FDO DE INVEST is currently generating about 0.02 per unit of risk. If you would invest 9,118 in BTG Pactual Logstica on August 30, 2024 and sell it today you would earn a total of 494.00 from holding BTG Pactual Logstica or generate 5.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTG Pactual Logstica vs. FDO DE INVEST
Performance |
| Timeline |
| BTG Pactual Logstica |
| FDO DE INVEST |
BTG Pactual and FDO DE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and FDO DE
The main advantage of trading using opposite BTG Pactual and FDO DE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, FDO DE 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 DE will offset losses from the drop in FDO DE'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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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