Correlation Between Energisa and Maxi Renda
Can any of the company-specific risk be diversified away by investing in both Energisa and Maxi Renda 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 Energisa and Maxi Renda into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energisa SA and Maxi Renda Fundo, you can compare the effects of market volatilities on Energisa and Maxi Renda 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 Energisa with a short position of Maxi Renda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energisa and Maxi Renda.
Diversification Opportunities for Energisa and Maxi Renda
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Energisa and Maxi is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Energisa SA and Maxi Renda Fundo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maxi Renda Fundo and Energisa 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 Energisa SA are associated (or correlated) with Maxi Renda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maxi Renda Fundo has no effect on the direction of Energisa i.e., Energisa and Maxi Renda go up and down completely randomly.
Pair Corralation between Energisa and Maxi Renda
Assuming the 90 days trading horizon Energisa SA is expected to under-perform the Maxi Renda. In addition to that, Energisa is 1.46 times more volatile than Maxi Renda Fundo. It trades about -0.04 of its total potential returns per unit of risk. Maxi Renda Fundo is currently generating about -0.05 per unit of volatility. If you would invest 949.00 in Maxi Renda Fundo on August 30, 2024 and sell it today you would lose (14.00) from holding Maxi Renda Fundo or give up 1.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Energisa SA vs. Maxi Renda Fundo
Performance |
| Timeline |
| Energisa SA |
| Maxi Renda Fundo |
Energisa and Maxi Renda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energisa and Maxi Renda
The main advantage of trading using opposite Energisa and Maxi Renda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energisa position performs unexpectedly, Maxi Renda 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 Maxi Renda will offset losses from the drop in Maxi Renda's long position.| Energisa vs. Equatorial Energia SA | Energisa vs. CPFL Energia SA | Energisa vs. Eneva SA | Energisa vs. Companhia de Saneamento |
| Maxi Renda vs. Domo Fundo de | Maxi Renda vs. Aesapar Fundo de | Maxi Renda vs. Ourinvest Jpp Fundo | Maxi Renda vs. Loft II Fundo |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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