Correlation Between BTG Pactual and Microsoft
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and Microsoft 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 Microsoft 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 Microsoft, you can compare the effects of market volatilities on BTG Pactual and Microsoft 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 Microsoft. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and Microsoft.
Diversification Opportunities for BTG Pactual and Microsoft
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BTG and Microsoft is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and Microsoft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microsoft 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 Microsoft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microsoft has no effect on the direction of BTG Pactual i.e., BTG Pactual and Microsoft go up and down completely randomly.
Pair Corralation between BTG Pactual and Microsoft
Assuming the 90 days trading horizon BTG Pactual Logstica is expected to under-perform the Microsoft. But the fund apears to be less risky and, when comparing its historical volatility, BTG Pactual Logstica is 1.78 times less risky than Microsoft. The fund trades about -0.02 of its potential returns per unit of risk. The Microsoft is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 9,819 in Microsoft on August 26, 2024 and sell it today you would earn a total of 200.00 from holding Microsoft or generate 2.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BTG Pactual Logstica vs. Microsoft
Performance |
| Timeline |
| BTG Pactual Logstica |
| Microsoft |
BTG Pactual and Microsoft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and Microsoft
The main advantage of trading using opposite BTG Pactual and Microsoft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, Microsoft 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 Microsoft will offset losses from the drop in Microsoft's long position.| BTG Pactual vs. Fundo Investimento Imobiliario | BTG Pactual vs. KILIMA VOLKANO RECEBVEIS | BTG Pactual vs. Santander Renda De | BTG Pactual vs. DEVANT PROPERTIES FUNDO |
| Microsoft vs. Align Technology | Microsoft vs. Hospital Mater Dei | Microsoft vs. Planet Fitness | Microsoft vs. Charter Communications |
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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