Correlation Between Eneva SA and BB Seguridade
Can any of the company-specific risk be diversified away by investing in both Eneva SA and BB Seguridade 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 Eneva SA and BB Seguridade into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eneva SA and BB Seguridade Participacoes, you can compare the effects of market volatilities on Eneva SA and BB Seguridade 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 Eneva SA with a short position of BB Seguridade. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eneva SA and BB Seguridade.
Diversification Opportunities for Eneva SA and BB Seguridade
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Eneva and BBSE3 is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Eneva SA and BB Seguridade Participacoes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BB Seguridade Partic and Eneva SA 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 Eneva SA are associated (or correlated) with BB Seguridade. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BB Seguridade Partic has no effect on the direction of Eneva SA i.e., Eneva SA and BB Seguridade go up and down completely randomly.
Pair Corralation between Eneva SA and BB Seguridade
Assuming the 90 days trading horizon Eneva SA is expected to under-perform the BB Seguridade. In addition to that, Eneva SA is 1.32 times more volatile than BB Seguridade Participacoes. It trades about -0.42 of its total potential returns per unit of risk. BB Seguridade Participacoes is currently generating about -0.06 per unit of volatility. If you would invest 3,438 in BB Seguridade Participacoes on August 27, 2024 and sell it today you would lose (43.00) from holding BB Seguridade Participacoes or give up 1.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eneva SA vs. BB Seguridade Participacoes
Performance |
| Timeline |
| Eneva SA |
| BB Seguridade Partic |
Eneva SA and BB Seguridade Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eneva SA and BB Seguridade
The main advantage of trading using opposite Eneva SA and BB Seguridade positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eneva SA position performs unexpectedly, BB Seguridade 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 BB Seguridade will offset losses from the drop in BB Seguridade's long position.| Eneva SA vs. BB Seguridade Participacoes | Eneva SA vs. Engie Brasil Energia | Eneva SA vs. CTEEP Companhia | Eneva SA vs. Itasa Investimentos |
| BB Seguridade vs. Transmissora Aliana de | BB Seguridade vs. Banco do Brasil | BB Seguridade vs. Itasa Investimentos | BB Seguridade vs. Engie Brasil Energia |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |