Correlation Between BTG Pactual and Santander Renda
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and Santander Renda 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 Santander Renda 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 Santander Renda De, you can compare the effects of market volatilities on BTG Pactual and Santander Renda 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 Santander Renda. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and Santander Renda.
Diversification Opportunities for BTG Pactual and Santander Renda
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BTG and Santander is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and Santander Renda De in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santander Renda De 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 Santander Renda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santander Renda De has no effect on the direction of BTG Pactual i.e., BTG Pactual and Santander Renda go up and down completely randomly.
Pair Corralation between BTG Pactual and Santander Renda
Assuming the 90 days trading horizon BTG Pactual Logstica is expected to generate 0.64 times more return on investment than Santander Renda. However, BTG Pactual Logstica is 1.56 times less risky than Santander Renda. It trades about 0.01 of its potential returns per unit of risk. Santander Renda De is currently generating about -0.17 per unit of risk. If you would invest 9,599 in BTG Pactual Logstica on August 30, 2024 and sell it today you would earn a total of 13.00 from holding BTG Pactual Logstica or generate 0.14% 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. Santander Renda De
Performance |
| Timeline |
| BTG Pactual Logstica |
| Santander Renda De |
BTG Pactual and Santander Renda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and Santander Renda
The main advantage of trading using opposite BTG Pactual and Santander Renda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, Santander Renda 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 Santander Renda will offset losses from the drop in Santander Renda's long position.| BTG Pactual vs. BTG Pactual Teva | BTG Pactual vs. BTG PACTUAL CRDITO | BTG Pactual vs. Real Estate Investment | BTG Pactual vs. NAVI CRDITO IMOBILIRIO |
| Santander Renda vs. Energisa SA | Santander Renda vs. BTG Pactual Logstica | Santander Renda vs. Plano Plano Desenvolvimento | Santander Renda vs. The Procter Gamble |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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