Correlation Between BTG Pactual and Galapagos Recebiveis
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and Galapagos Recebiveis 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 Galapagos Recebiveis 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 Galapagos Recebiveis Imobiliarios, you can compare the effects of market volatilities on BTG Pactual and Galapagos Recebiveis 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 Galapagos Recebiveis. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and Galapagos Recebiveis.
Diversification Opportunities for BTG Pactual and Galapagos Recebiveis
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BTG and Galapagos is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and Galapagos Recebiveis Imobiliar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galapagos Recebiveis 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 Galapagos Recebiveis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galapagos Recebiveis has no effect on the direction of BTG Pactual i.e., BTG Pactual and Galapagos Recebiveis go up and down completely randomly.
Pair Corralation between BTG Pactual and Galapagos Recebiveis
Assuming the 90 days trading horizon BTG Pactual Logstica is expected to generate 0.82 times more return on investment than Galapagos Recebiveis. However, BTG Pactual Logstica is 1.23 times less risky than Galapagos Recebiveis. It trades about -0.06 of its potential returns per unit of risk. Galapagos Recebiveis Imobiliarios is currently generating about -0.12 per unit of risk. If you would invest 10,003 in BTG Pactual Logstica on September 5, 2024 and sell it today you would lose (1,036) from holding BTG Pactual Logstica or give up 10.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTG Pactual Logstica vs. Galapagos Recebiveis Imobiliar
Performance |
| Timeline |
| BTG Pactual Logstica |
| Galapagos Recebiveis |
BTG Pactual and Galapagos Recebiveis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and Galapagos Recebiveis
The main advantage of trading using opposite BTG Pactual and Galapagos Recebiveis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, Galapagos Recebiveis 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 Galapagos Recebiveis will offset losses from the drop in Galapagos Recebiveis' long position.| BTG Pactual vs. Fundos de Investimento | BTG Pactual vs. Hectare Recebiveis High | BTG Pactual vs. SDI Logstica Rio | BTG Pactual vs. Caixa Rio Bravo |
| Galapagos Recebiveis vs. Fras le SA | Galapagos Recebiveis vs. Western Digital | Galapagos Recebiveis vs. Clave Indices De | Galapagos Recebiveis vs. BTG Pactual Logstica |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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