Correlation Between Centrais Electricas and Hub Cyber
Can any of the company-specific risk be diversified away by investing in both Centrais Electricas and Hub Cyber 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 Hub Cyber 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 Hub Cyber Security, you can compare the effects of market volatilities on Centrais Electricas and Hub Cyber 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 Hub Cyber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centrais Electricas and Hub Cyber.
Diversification Opportunities for Centrais Electricas and Hub Cyber
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Centrais and Hub is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Centrais Electricas Brasileira and Hub Cyber Security in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hub Cyber Security 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 Hub Cyber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hub Cyber Security has no effect on the direction of Centrais Electricas i.e., Centrais Electricas and Hub Cyber go up and down completely randomly.
Pair Corralation between Centrais Electricas and Hub Cyber
Considering the 90-day investment horizon Centrais Electricas Brasileiras is expected to under-perform the Hub Cyber. But the stock apears to be less risky and, when comparing its historical volatility, Centrais Electricas Brasileiras is 5.6 times less risky than Hub Cyber. The stock trades about -0.04 of its potential returns per unit of risk. The Hub Cyber Security is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 118.00 in Hub Cyber Security on December 5, 2024 and sell it today you would lose (58.00) from holding Hub Cyber Security or give up 49.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centrais Electricas Brasileira vs. Hub Cyber Security
Performance |
| Timeline |
| Centrais Electricas |
| Hub Cyber Security |
Centrais Electricas and Hub Cyber Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centrais Electricas and Hub Cyber
The main advantage of trading using opposite Centrais Electricas and Hub Cyber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centrais Electricas position performs unexpectedly, Hub Cyber 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 Hub Cyber will offset losses from the drop in Hub Cyber'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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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