Correlation Between Companhia Brasileira and Kohls Corp
Can any of the company-specific risk be diversified away by investing in both Companhia Brasileira and Kohls Corp 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 Companhia Brasileira and Kohls Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Companhia Brasileira De and Kohls Corp, you can compare the effects of market volatilities on Companhia Brasileira and Kohls Corp 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 Companhia Brasileira with a short position of Kohls Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Companhia Brasileira and Kohls Corp.
Diversification Opportunities for Companhia Brasileira and Kohls Corp
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Companhia and Kohls is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Companhia Brasileira De and Kohls Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kohls Corp and Companhia Brasileira 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 Companhia Brasileira De are associated (or correlated) with Kohls Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kohls Corp has no effect on the direction of Companhia Brasileira i.e., Companhia Brasileira and Kohls Corp go up and down completely randomly.
Pair Corralation between Companhia Brasileira and Kohls Corp
If you would invest 450.00 in Companhia Brasileira De on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Companhia Brasileira De or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
Companhia Brasileira De vs. Kohls Corp
Performance |
| Timeline |
| Companhia Brasileira |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Kohls Corp |
Companhia Brasileira and Kohls Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Companhia Brasileira and Kohls Corp
The main advantage of trading using opposite Companhia Brasileira and Kohls Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Companhia Brasileira position performs unexpectedly, Kohls Corp 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 Kohls Corp will offset losses from the drop in Kohls Corp's long position.The idea behind Companhia Brasileira De and Kohls Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Kohls Corp vs. Nordstrom | Kohls Corp vs. Dillards | Kohls Corp vs. Marks Spencer Group | Kohls Corp vs. Marks and Spencer |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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