Correlation Between HUSI11 and Btg Pactual
Can any of the company-specific risk be diversified away by investing in both HUSI11 and Btg Pactual 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 HUSI11 and Btg Pactual into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HUSI11 and Btg Pactual Real, you can compare the effects of market volatilities on HUSI11 and Btg Pactual 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 HUSI11 with a short position of Btg Pactual. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUSI11 and Btg Pactual.
Diversification Opportunities for HUSI11 and Btg Pactual
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between HUSI11 and Btg is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding HUSI11 and Btg Pactual Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Btg Pactual Real and HUSI11 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 HUSI11 are associated (or correlated) with Btg Pactual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Btg Pactual Real has no effect on the direction of HUSI11 i.e., HUSI11 and Btg Pactual go up and down completely randomly.
Pair Corralation between HUSI11 and Btg Pactual
Assuming the 90 days trading horizon HUSI11 is expected to generate 1.21 times more return on investment than Btg Pactual. However, HUSI11 is 1.21 times more volatile than Btg Pactual Real. It trades about 0.04 of its potential returns per unit of risk. Btg Pactual Real is currently generating about -0.65 per unit of risk. If you would invest 116,658 in HUSI11 on November 2, 2024 and sell it today you would earn a total of 5,842 from holding HUSI11 or generate 5.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 29.41% |
| Values | Daily Returns |
HUSI11 vs. Btg Pactual Real
Performance |
| Timeline |
| HUSI11 |
| Btg Pactual Real |
HUSI11 and Btg Pactual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUSI11 and Btg Pactual
The main advantage of trading using opposite HUSI11 and Btg Pactual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUSI11 position performs unexpectedly, Btg Pactual 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 Btg Pactual will offset losses from the drop in Btg Pactual's long position.| HUSI11 vs. Energisa SA | HUSI11 vs. BTG Pactual Logstica | HUSI11 vs. Plano Plano Desenvolvimento | HUSI11 vs. Ares Management |
| Btg Pactual vs. Energisa SA | Btg Pactual vs. BTG Pactual Logstica | Btg Pactual vs. Plano Plano Desenvolvimento | Btg Pactual vs. Ares Management |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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