Correlation Between GPS Participaes and Infracommerce CXaaS
Can any of the company-specific risk be diversified away by investing in both GPS Participaes and Infracommerce CXaaS 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 GPS Participaes and Infracommerce CXaaS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GPS Participaes e and Infracommerce CXaaS SA, you can compare the effects of market volatilities on GPS Participaes and Infracommerce CXaaS 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 GPS Participaes with a short position of Infracommerce CXaaS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GPS Participaes and Infracommerce CXaaS.
Diversification Opportunities for GPS Participaes and Infracommerce CXaaS
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GPS and Infracommerce is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding GPS Participaes e and Infracommerce CXaaS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infracommerce CXaaS and GPS Participaes 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 GPS Participaes e are associated (or correlated) with Infracommerce CXaaS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infracommerce CXaaS has no effect on the direction of GPS Participaes i.e., GPS Participaes and Infracommerce CXaaS go up and down completely randomly.
Pair Corralation between GPS Participaes and Infracommerce CXaaS
Assuming the 90 days trading horizon GPS Participaes e is expected to generate 0.24 times more return on investment than Infracommerce CXaaS. However, GPS Participaes e is 4.11 times less risky than Infracommerce CXaaS. It trades about 0.03 of its potential returns per unit of risk. Infracommerce CXaaS SA is currently generating about -0.08 per unit of risk. If you would invest 1,224 in GPS Participaes e on November 28, 2024 and sell it today you would earn a total of 255.00 from holding GPS Participaes e or generate 20.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
GPS Participaes e vs. Infracommerce CXaaS SA
Performance |
| Timeline |
| GPS Participaes e |
| Infracommerce CXaaS |
GPS Participaes and Infracommerce CXaaS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GPS Participaes and Infracommerce CXaaS
The main advantage of trading using opposite GPS Participaes and Infracommerce CXaaS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GPS Participaes position performs unexpectedly, Infracommerce CXaaS 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 Infracommerce CXaaS will offset losses from the drop in Infracommerce CXaaS's long position.| GPS Participaes vs. Lojas Quero Quero SA | GPS Participaes vs. Grupo SBF SA | GPS Participaes vs. Mitre Realty Empreendimentos | GPS Participaes vs. Infracommerce CXaaS SA |
| Infracommerce CXaaS vs. Mliuz SA | Infracommerce CXaaS vs. Lojas Quero Quero SA | Infracommerce CXaaS vs. GPS Participaes e | Infracommerce CXaaS vs. Grupo SBF 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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