Correlation Between Interactive Brokers and Xp
Can any of the company-specific risk be diversified away by investing in both Interactive Brokers and Xp 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 Interactive Brokers and Xp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Interactive Brokers Group and Xp Inc, you can compare the effects of market volatilities on Interactive Brokers and Xp 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 Interactive Brokers with a short position of Xp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interactive Brokers and Xp.
Diversification Opportunities for Interactive Brokers and Xp
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Interactive and Xp is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Interactive Brokers Group and Xp Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xp Inc and Interactive Brokers 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 Interactive Brokers Group are associated (or correlated) with Xp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xp Inc has no effect on the direction of Interactive Brokers i.e., Interactive Brokers and Xp go up and down completely randomly.
Pair Corralation between Interactive Brokers and Xp
Given the investment horizon of 90 days Interactive Brokers Group is expected to generate 0.88 times more return on investment than Xp. However, Interactive Brokers Group is 1.14 times less risky than Xp. It trades about 0.29 of its potential returns per unit of risk. Xp Inc is currently generating about -0.03 per unit of risk. If you would invest 17,760 in Interactive Brokers Group on October 24, 2024 and sell it today you would earn a total of 1,523 from holding Interactive Brokers Group or generate 8.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Interactive Brokers Group vs. Xp Inc
Performance |
| Timeline |
| Interactive Brokers |
| Xp Inc |
Interactive Brokers and Xp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Interactive Brokers and Xp
The main advantage of trading using opposite Interactive Brokers and Xp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interactive Brokers position performs unexpectedly, Xp 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 Xp will offset losses from the drop in Xp's long position.| Interactive Brokers vs. Adtalem Global Education | Interactive Brokers vs. Loews Corp | Interactive Brokers vs. Udemy Inc | Interactive Brokers vs. Ihuman Inc |
| Xp vs. Up Fintech Holding | Xp vs. Bit Digital | Xp vs. Marathon Digital Holdings | Xp vs. MarketAxess Holdings |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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