Correlation Between Comcast Corp and Telefonica Brasil
Can any of the company-specific risk be diversified away by investing in both Comcast Corp and Telefonica Brasil 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 Comcast Corp and Telefonica Brasil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comcast Corp and Telefonica Brasil SA, you can compare the effects of market volatilities on Comcast Corp and Telefonica Brasil 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 Comcast Corp with a short position of Telefonica Brasil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comcast Corp and Telefonica Brasil.
Diversification Opportunities for Comcast Corp and Telefonica Brasil
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Comcast and Telefonica is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Comcast Corp and Telefonica Brasil SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telefonica Brasil and Comcast Corp 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 Comcast Corp are associated (or correlated) with Telefonica Brasil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telefonica Brasil has no effect on the direction of Comcast Corp i.e., Comcast Corp and Telefonica Brasil go up and down completely randomly.
Pair Corralation between Comcast Corp and Telefonica Brasil
Assuming the 90 days horizon Comcast Corp is expected to generate 0.97 times more return on investment than Telefonica Brasil. However, Comcast Corp is 1.04 times less risky than Telefonica Brasil. It trades about 0.11 of its potential returns per unit of risk. Telefonica Brasil SA is currently generating about -0.1 per unit of risk. If you would invest 3,952 in Comcast Corp on August 23, 2024 and sell it today you would earn a total of 398.00 from holding Comcast Corp or generate 10.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comcast Corp vs. Telefonica Brasil SA
Performance |
| Timeline |
| Comcast Corp |
| Telefonica Brasil |
Comcast Corp and Telefonica Brasil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comcast Corp and Telefonica Brasil
The main advantage of trading using opposite Comcast Corp and Telefonica Brasil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comcast Corp position performs unexpectedly, Telefonica Brasil 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 Telefonica Brasil will offset losses from the drop in Telefonica Brasil's long position.| Comcast Corp vs. Small Cap Core | Comcast Corp vs. FitLife Brands, Common | Comcast Corp vs. Mutual Of America | Comcast Corp vs. Gfl Environmental Holdings |
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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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