Correlation Between DexCom and Telefnica Brasil
Can any of the company-specific risk be diversified away by investing in both DexCom and Telefnica 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 DexCom and Telefnica Brasil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DexCom Inc and Telefnica Brasil SA, you can compare the effects of market volatilities on DexCom and Telefnica 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 DexCom with a short position of Telefnica Brasil. Check out your portfolio center. Please also check ongoing floating volatility patterns of DexCom and Telefnica Brasil.
Diversification Opportunities for DexCom and Telefnica Brasil
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DexCom and Telefnica is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding DexCom Inc and Telefnica Brasil SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telefnica Brasil and DexCom 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 DexCom Inc are associated (or correlated) with Telefnica Brasil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telefnica Brasil has no effect on the direction of DexCom i.e., DexCom and Telefnica Brasil go up and down completely randomly.
Pair Corralation between DexCom and Telefnica Brasil
Assuming the 90 days trading horizon DexCom Inc is expected to under-perform the Telefnica Brasil. In addition to that, DexCom is 2.28 times more volatile than Telefnica Brasil SA. It trades about -0.01 of its total potential returns per unit of risk. Telefnica Brasil SA is currently generating about 0.06 per unit of volatility. If you would invest 3,426 in Telefnica Brasil SA on August 27, 2024 and sell it today you would earn a total of 1,674 from holding Telefnica Brasil SA or generate 48.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
DexCom Inc vs. Telefnica Brasil SA
Performance |
| Timeline |
| DexCom Inc |
| Telefnica Brasil |
DexCom and Telefnica Brasil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DexCom and Telefnica Brasil
The main advantage of trading using opposite DexCom and Telefnica Brasil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DexCom position performs unexpectedly, Telefnica 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 Telefnica Brasil will offset losses from the drop in Telefnica Brasil's long position.| DexCom vs. Agilent Technologies | DexCom vs. Fras le SA | DexCom vs. Western Digital | DexCom vs. Clave Indices De |
| Telefnica Brasil vs. T Mobile | Telefnica Brasil vs. Verizon Communications | Telefnica Brasil vs. Telefnica SA |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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