Correlation Between Centrais Electricas and YH Dimri
Can any of the company-specific risk be diversified away by investing in both Centrais Electricas and YH Dimri 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 Centrais Electricas and YH Dimri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centrais Electricas Brasileiras and YH Dimri Construction, you can compare the effects of market volatilities on Centrais Electricas and YH Dimri 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 Centrais Electricas with a short position of YH Dimri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centrais Electricas and YH Dimri.
Diversification Opportunities for Centrais Electricas and YH Dimri
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Centrais and DIMRI is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Centrais Electricas Brasileira and YH Dimri Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YH Dimri Construction and Centrais Electricas 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 Centrais Electricas Brasileiras are associated (or correlated) with YH Dimri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YH Dimri Construction has no effect on the direction of Centrais Electricas i.e., Centrais Electricas and YH Dimri go up and down completely randomly.
Pair Corralation between Centrais Electricas and YH Dimri
Considering the 90-day investment horizon Centrais Electricas Brasileiras is expected to generate 0.95 times more return on investment than YH Dimri. However, Centrais Electricas Brasileiras is 1.05 times less risky than YH Dimri. It trades about 0.08 of its potential returns per unit of risk. YH Dimri Construction is currently generating about -0.26 per unit of risk. If you would invest 630.00 in Centrais Electricas Brasileiras on December 5, 2024 and sell it today you would earn a total of 16.00 from holding Centrais Electricas Brasileiras or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.71% |
| Values | Daily Returns |
Centrais Electricas Brasileira vs. YH Dimri Construction
Performance |
| Timeline |
| Centrais Electricas |
| YH Dimri Construction |
Centrais Electricas and YH Dimri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centrais Electricas and YH Dimri
The main advantage of trading using opposite Centrais Electricas and YH Dimri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centrais Electricas position performs unexpectedly, YH Dimri 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 YH Dimri will offset losses from the drop in YH Dimri's long position.| Centrais Electricas vs. Genie Energy | ||
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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