Correlation Between BTG Pactual and WHG REAL
Can any of the company-specific risk be diversified away by investing in both BTG Pactual and WHG REAL 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 WHG REAL 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 WHG REAL ESTATE, you can compare the effects of market volatilities on BTG Pactual and WHG REAL 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 WHG REAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of BTG Pactual and WHG REAL.
Diversification Opportunities for BTG Pactual and WHG REAL
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BTG and WHG is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding BTG Pactual Logstica and WHG REAL ESTATE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WHG REAL ESTATE 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 WHG REAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WHG REAL ESTATE has no effect on the direction of BTG Pactual i.e., BTG Pactual and WHG REAL go up and down completely randomly.
Pair Corralation between BTG Pactual and WHG REAL
Assuming the 90 days trading horizon BTG Pactual is expected to generate 4.55 times less return on investment than WHG REAL. But when comparing it to its historical volatility, BTG Pactual Logstica is 1.15 times less risky than WHG REAL. It trades about 0.01 of its potential returns per unit of risk. WHG REAL ESTATE is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 793.00 in WHG REAL ESTATE on September 5, 2024 and sell it today you would earn a total of 101.00 from holding WHG REAL ESTATE or generate 12.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
BTG Pactual Logstica vs. WHG REAL ESTATE
Performance |
| Timeline |
| BTG Pactual Logstica |
| WHG REAL ESTATE |
BTG Pactual and WHG REAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BTG Pactual and WHG REAL
The main advantage of trading using opposite BTG Pactual and WHG REAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BTG Pactual position performs unexpectedly, WHG REAL 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 WHG REAL will offset losses from the drop in WHG REAL's 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 |
| WHG REAL vs. Energisa SA | WHG REAL vs. BTG Pactual Logstica | WHG REAL vs. Plano Plano Desenvolvimento | WHG REAL vs. Companhia Habitasul de |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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