Correlation Between Hypera SA and Grendene
Can any of the company-specific risk be diversified away by investing in both Hypera SA and Grendene 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 Hypera SA and Grendene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hypera SA and Grendene SA, you can compare the effects of market volatilities on Hypera SA and Grendene 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 Hypera SA with a short position of Grendene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hypera SA and Grendene.
Diversification Opportunities for Hypera SA and Grendene
Poor diversification
The 3 months correlation between Hypera and Grendene is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Hypera SA and Grendene SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grendene SA and Hypera 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 Hypera SA are associated (or correlated) with Grendene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grendene SA has no effect on the direction of Hypera SA i.e., Hypera SA and Grendene go up and down completely randomly.
Pair Corralation between Hypera SA and Grendene
Assuming the 90 days trading horizon Hypera SA is expected to under-perform the Grendene. In addition to that, Hypera SA is 1.51 times more volatile than Grendene SA. It trades about -0.12 of its total potential returns per unit of risk. Grendene SA is currently generating about -0.08 per unit of volatility. If you would invest 609.00 in Grendene SA on September 2, 2024 and sell it today you would lose (91.00) from holding Grendene SA or give up 14.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hypera SA vs. Grendene SA
Performance |
| Timeline |
| Hypera SA |
| Grendene SA |
Hypera SA and Grendene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hypera SA and Grendene
The main advantage of trading using opposite Hypera SA and Grendene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hypera SA position performs unexpectedly, Grendene 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 Grendene will offset losses from the drop in Grendene's long position.| Hypera SA vs. Raia Drogasil SA | Hypera SA vs. Fleury SA | Hypera SA vs. Qualicorp Consultoria e | Hypera SA vs. Lojas Renner SA |
| Grendene vs. Engie Brasil Energia | Grendene vs. Energisa SA | Grendene vs. Clave Indices De | Grendene vs. BTG Pactual Logstica |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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