Correlation Between Basic Materials and EXES FUNDO
Can any of the company-specific risk be diversified away by investing in both Basic Materials and EXES FUNDO 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 Basic Materials and EXES FUNDO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Basic Materials and EXES FUNDO DE, you can compare the effects of market volatilities on Basic Materials and EXES FUNDO 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 Basic Materials with a short position of EXES FUNDO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Basic Materials and EXES FUNDO.
Diversification Opportunities for Basic Materials and EXES FUNDO
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Basic and EXES is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Basic Materials and EXES FUNDO DE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EXES FUNDO DE and Basic Materials 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 Basic Materials are associated (or correlated) with EXES FUNDO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EXES FUNDO DE has no effect on the direction of Basic Materials i.e., Basic Materials and EXES FUNDO go up and down completely randomly.
Pair Corralation between Basic Materials and EXES FUNDO
Assuming the 90 days trading horizon Basic Materials is expected to generate 1.87 times less return on investment than EXES FUNDO. In addition to that, Basic Materials is 1.57 times more volatile than EXES FUNDO DE. It trades about 0.03 of its total potential returns per unit of risk. EXES FUNDO DE is currently generating about 0.08 per unit of volatility. If you would invest 890.00 in EXES FUNDO DE on November 2, 2024 and sell it today you would earn a total of 60.00 from holding EXES FUNDO DE or generate 6.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.03% |
| Values | Daily Returns |
Basic Materials vs. EXES FUNDO DE
Performance |
| Timeline |
Basic Materials and EXES FUNDO Volatility Contrast
Predicted Return Density |
| Returns |
Basic Materials
Pair trading matchups for Basic Materials
EXES FUNDO DE
Pair trading matchups for EXES FUNDO
Pair Trading with Basic Materials and EXES FUNDO
The main advantage of trading using opposite Basic Materials and EXES FUNDO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Basic Materials position performs unexpectedly, EXES FUNDO 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 EXES FUNDO will offset losses from the drop in EXES FUNDO's long position.| Basic Materials vs. Caesars Entertainment, | Basic Materials vs. Delta Air Lines | Basic Materials vs. Burlington Stores, | Basic Materials vs. Nordon Indstrias Metalrgicas |
| EXES FUNDO vs. BTG Pactual Logstica | EXES FUNDO vs. Caixa Rio Bravo | EXES FUNDO vs. Nu Renda Ibov | EXES FUNDO vs. V2 Recebveis Imobilirios |
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 CEOs Directory module to screen CEOs from public companies around the world.
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