Correlation Between BTG Pactual and Mid America
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and Mid America 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 Mid America 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 Mid America Apartment Communities, you can compare the effects of market volatilities on BTG Pactual and Mid America 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 Mid America. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and Mid America.
Diversification Opportunities for BTG Pactual and Mid America
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BTG and Mid is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and Mid America Apartment Communit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mid America Apartment 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 Mid America. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mid America Apartment has no effect on the direction of BTG Pactual i.e., BTG Pactual and Mid America go up and down completely randomly.
Pair Corralation between BTG Pactual and Mid America
Assuming the 90 days trading horizon BTG Pactual is expected to generate 4.0 times less return on investment than Mid America. But when comparing it to its historical volatility, BTG Pactual Logstica is 3.24 times less risky than Mid America. It trades about 0.02 of its potential returns per unit of risk. Mid America Apartment Communities is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 19,791 in Mid America Apartment Communities on October 18, 2024 and sell it today you would earn a total of 3,439 from holding Mid America Apartment Communities or generate 17.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 88.87% |
| Values | Daily Returns |
BTG Pactual Logstica vs. Mid America Apartment Communit
Performance |
| Timeline |
| BTG Pactual Logstica |
| Mid America Apartment |
BTG Pactual and Mid America Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and Mid America
The main advantage of trading using opposite BTG Pactual and Mid America positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, Mid America 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 Mid America will offset losses from the drop in Mid America's long position.| BTG Pactual vs. Btg Pactual Real | BTG Pactual vs. Fundo Investimento Imobiliario | BTG Pactual vs. KILIMA VOLKANO RECEBVEIS | BTG Pactual vs. DEVANT PROPERTIES FUNDO |
| Mid America vs. Sun Communities | Mid America vs. Apartment Investment and | Mid America vs. Energisa SA | Mid America 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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