Correlation Between Inepar SA and Refinaria
Can any of the company-specific risk be diversified away by investing in both Inepar SA and Refinaria 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 Inepar SA and Refinaria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inepar SA Indstria and Refinaria de Petrleos, you can compare the effects of market volatilities on Inepar SA and Refinaria 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 Inepar SA with a short position of Refinaria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inepar SA and Refinaria.
Diversification Opportunities for Inepar SA and Refinaria
Very weak diversification
The 3 months correlation between Inepar and Refinaria is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Inepar SA Indstria and Refinaria de Petrleos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Refinaria de Petrleos and Inepar 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 Inepar SA Indstria are associated (or correlated) with Refinaria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Refinaria de Petrleos has no effect on the direction of Inepar SA i.e., Inepar SA and Refinaria go up and down completely randomly.
Pair Corralation between Inepar SA and Refinaria
Assuming the 90 days trading horizon Inepar SA Indstria is expected to generate 2.67 times more return on investment than Refinaria. However, Inepar SA is 2.67 times more volatile than Refinaria de Petrleos. It trades about 0.1 of its potential returns per unit of risk. Refinaria de Petrleos is currently generating about 0.07 per unit of risk. If you would invest 144.00 in Inepar SA Indstria on November 18, 2024 and sell it today you would earn a total of 11.00 from holding Inepar SA Indstria or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inepar SA Indstria vs. Refinaria de Petrleos
Performance |
| Timeline |
| Inepar SA Indstria |
| Refinaria de Petrleos |
Inepar SA and Refinaria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inepar SA and Refinaria
The main advantage of trading using opposite Inepar SA and Refinaria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inepar SA position performs unexpectedly, Refinaria 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 Refinaria will offset losses from the drop in Refinaria's long position.| Inepar SA vs. Lupatech SA | Inepar SA vs. Inepar SA Indstria | Inepar SA vs. Eternit SA | Inepar SA vs. Bombril SA |
| Refinaria vs. Lupatech SA | Refinaria vs. Recrusul SA | Refinaria vs. PDG Realty SA | Refinaria vs. OSX Brasil 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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