Correlation Between Grazziotin and Macys
Can any of the company-specific risk be diversified away by investing in both Grazziotin and Macys 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 Grazziotin and Macys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grazziotin SA and Macys Inc, you can compare the effects of market volatilities on Grazziotin and Macys 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 Grazziotin with a short position of Macys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grazziotin and Macys.
Diversification Opportunities for Grazziotin and Macys
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grazziotin and Macys is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Grazziotin SA and Macys Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macys Inc and Grazziotin 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 Grazziotin SA are associated (or correlated) with Macys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macys Inc has no effect on the direction of Grazziotin i.e., Grazziotin and Macys go up and down completely randomly.
Pair Corralation between Grazziotin and Macys
Assuming the 90 days trading horizon Grazziotin SA is expected to generate 0.87 times more return on investment than Macys. However, Grazziotin SA is 1.14 times less risky than Macys. It trades about -0.08 of its potential returns per unit of risk. Macys Inc is currently generating about -0.18 per unit of risk. If you would invest 2,715 in Grazziotin SA on November 9, 2024 and sell it today you would lose (122.00) from holding Grazziotin SA or give up 4.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Grazziotin SA vs. Macys Inc
Performance |
| Timeline |
| Grazziotin SA |
| Macys Inc |
Grazziotin and Macys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grazziotin and Macys
The main advantage of trading using opposite Grazziotin and Macys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grazziotin position performs unexpectedly, Macys 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 Macys will offset losses from the drop in Macys' long position.| Grazziotin vs. Grazziotin SA | Grazziotin vs. Cia de Ferro | Grazziotin vs. Banco ABC Brasil | Grazziotin vs. Grendene SA |
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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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