Correlation Between Grazziotin and Pettenati
Can any of the company-specific risk be diversified away by investing in both Grazziotin and Pettenati 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 Pettenati into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grazziotin SA and Pettenati SA Industria, you can compare the effects of market volatilities on Grazziotin and Pettenati 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 Pettenati. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grazziotin and Pettenati.
Diversification Opportunities for Grazziotin and Pettenati
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Grazziotin and Pettenati is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Grazziotin SA and Pettenati SA Industria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pettenati SA Industria 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 Pettenati. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pettenati SA Industria has no effect on the direction of Grazziotin i.e., Grazziotin and Pettenati go up and down completely randomly.
Pair Corralation between Grazziotin and Pettenati
Assuming the 90 days trading horizon Grazziotin SA is expected to generate 1.25 times more return on investment than Pettenati. However, Grazziotin is 1.25 times more volatile than Pettenati SA Industria. It trades about 0.1 of its potential returns per unit of risk. Pettenati SA Industria is currently generating about -0.18 per unit of risk. If you would invest 2,393 in Grazziotin SA on October 26, 2024 and sell it today you would earn a total of 219.00 from holding Grazziotin SA or generate 9.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grazziotin SA vs. Pettenati SA Industria
Performance |
| Timeline |
| Grazziotin SA |
| Pettenati SA Industria |
Grazziotin and Pettenati Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grazziotin and Pettenati
The main advantage of trading using opposite Grazziotin and Pettenati positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grazziotin position performs unexpectedly, Pettenati 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 Pettenati will offset losses from the drop in Pettenati's long position.| Grazziotin vs. Txtil Renauxview SA | Grazziotin vs. Telecomunicaes Brasileiras SA | Grazziotin vs. Recrusul SA | Grazziotin vs. Pettenati SA Industria |
| Pettenati vs. Schulz SA | Pettenati vs. Springs Global Participaes | Pettenati vs. Grazziotin SA | Pettenati vs. Companhia de Tecidos |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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