Correlation Between BTG Pactual and Gen Digital
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and Gen Digital 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 Gen Digital 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 Gen Digital, you can compare the effects of market volatilities on BTG Pactual and Gen Digital 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 Gen Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and Gen Digital.
Diversification Opportunities for BTG Pactual and Gen Digital
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BTG and Gen is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and Gen Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gen Digital 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 Gen Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gen Digital has no effect on the direction of BTG Pactual i.e., BTG Pactual and Gen Digital go up and down completely randomly.
Pair Corralation between BTG Pactual and Gen Digital
Assuming the 90 days trading horizon BTG Pactual is expected to generate 6.65 times less return on investment than Gen Digital. But when comparing it to its historical volatility, BTG Pactual Logstica is 2.58 times less risky than Gen Digital. It trades about 0.02 of its potential returns per unit of risk. Gen Digital is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 11,914 in Gen Digital on October 13, 2024 and sell it today you would earn a total of 5,979 from holding Gen Digital or generate 50.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
BTG Pactual Logstica vs. Gen Digital
Performance |
| Timeline |
| BTG Pactual Logstica |
| Gen Digital |
BTG Pactual and Gen Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and Gen Digital
The main advantage of trading using opposite BTG Pactual and Gen Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, Gen Digital 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 Gen Digital will offset losses from the drop in Gen Digital'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 |
| Gen Digital vs. Tyson Foods | Gen Digital vs. United Airlines Holdings | Gen Digital vs. Paycom Software | Gen Digital vs. DXC Technology |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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