Correlation Between GRUPUL INDUSTRIAL and Patria Bank
Can any of the company-specific risk be diversified away by investing in both GRUPUL INDUSTRIAL and Patria Bank 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 GRUPUL INDUSTRIAL and Patria Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GRUPUL INDUSTRIAL ELECTROCONTACT and Patria Bank SA, you can compare the effects of market volatilities on GRUPUL INDUSTRIAL and Patria Bank 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 GRUPUL INDUSTRIAL with a short position of Patria Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRUPUL INDUSTRIAL and Patria Bank.
Diversification Opportunities for GRUPUL INDUSTRIAL and Patria Bank
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between GRUPUL and Patria is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding GRUPUL INDUSTRIAL ELECTROCONTA and Patria Bank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Patria Bank SA and GRUPUL INDUSTRIAL 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 GRUPUL INDUSTRIAL ELECTROCONTACT are associated (or correlated) with Patria Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Patria Bank SA has no effect on the direction of GRUPUL INDUSTRIAL i.e., GRUPUL INDUSTRIAL and Patria Bank go up and down completely randomly.
Pair Corralation between GRUPUL INDUSTRIAL and Patria Bank
Assuming the 90 days trading horizon GRUPUL INDUSTRIAL ELECTROCONTACT is expected to generate 7.39 times more return on investment than Patria Bank. However, GRUPUL INDUSTRIAL is 7.39 times more volatile than Patria Bank SA. It trades about 0.22 of its potential returns per unit of risk. Patria Bank SA is currently generating about -0.13 per unit of risk. If you would invest 4.45 in GRUPUL INDUSTRIAL ELECTROCONTACT on November 4, 2024 and sell it today you would earn a total of 1.35 from holding GRUPUL INDUSTRIAL ELECTROCONTACT or generate 30.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRUPUL INDUSTRIAL ELECTROCONTA vs. Patria Bank SA
Performance |
| Timeline |
| GRUPUL INDUSTRIAL |
| Patria Bank SA |
GRUPUL INDUSTRIAL and Patria Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRUPUL INDUSTRIAL and Patria Bank
The main advantage of trading using opposite GRUPUL INDUSTRIAL and Patria Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRUPUL INDUSTRIAL position performs unexpectedly, Patria Bank 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 Patria Bank will offset losses from the drop in Patria Bank's long position.| GRUPUL INDUSTRIAL vs. AROBS TRANSILVANIA SOFTWARE | GRUPUL INDUSTRIAL vs. Erste Group Bank | GRUPUL INDUSTRIAL vs. Compania Hoteliera InterContinental | GRUPUL INDUSTRIAL vs. Digi Communications NV |
| Patria Bank vs. Erste Group Bank | Patria Bank vs. Digi Communications NV | Patria Bank vs. Biofarm Bucure | Patria Bank vs. Evergent Investments 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |