Correlation Between Eternit SA and Marcopolo
Can any of the company-specific risk be diversified away by investing in both Eternit SA and Marcopolo 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 Eternit SA and Marcopolo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eternit SA and Marcopolo SA, you can compare the effects of market volatilities on Eternit SA and Marcopolo 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 Eternit SA with a short position of Marcopolo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eternit SA and Marcopolo.
Diversification Opportunities for Eternit SA and Marcopolo
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eternit and Marcopolo is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Eternit SA and Marcopolo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marcopolo SA and Eternit 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 Eternit SA are associated (or correlated) with Marcopolo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marcopolo SA has no effect on the direction of Eternit SA i.e., Eternit SA and Marcopolo go up and down completely randomly.
Pair Corralation between Eternit SA and Marcopolo
Assuming the 90 days trading horizon Eternit SA is expected to under-perform the Marcopolo. In addition to that, Eternit SA is 1.15 times more volatile than Marcopolo SA. It trades about -0.02 of its total potential returns per unit of risk. Marcopolo SA is currently generating about 0.1 per unit of volatility. If you would invest 625.00 in Marcopolo SA on August 28, 2024 and sell it today you would earn a total of 334.00 from holding Marcopolo SA or generate 53.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.05% |
| Values | Daily Returns |
Eternit SA vs. Marcopolo SA
Performance |
| Timeline |
| Eternit SA |
| Marcopolo SA |
Eternit SA and Marcopolo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eternit SA and Marcopolo
The main advantage of trading using opposite Eternit SA and Marcopolo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eternit SA position performs unexpectedly, Marcopolo 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 Marcopolo will offset losses from the drop in Marcopolo's long position.| Eternit SA vs. Marcopolo SA | Eternit SA vs. Randon SA Implementos | Eternit SA vs. Companhia Siderrgica Nacional | Eternit SA vs. Positivo Tecnologia SA |
| Marcopolo vs. Randon SA Implementos | Marcopolo vs. Metalurgica Gerdau SA | Marcopolo vs. CCR SA | Marcopolo vs. Iochpe Maxion 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |