Correlation Between Ita Unibanco and Agilent Technologies
Can any of the company-specific risk be diversified away by investing in both Ita Unibanco and Agilent Technologies 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 Ita Unibanco and Agilent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ita Unibanco Holding and Agilent Technologies, you can compare the effects of market volatilities on Ita Unibanco and Agilent Technologies 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 Ita Unibanco with a short position of Agilent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ita Unibanco and Agilent Technologies.
Diversification Opportunities for Ita Unibanco and Agilent Technologies
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ita and Agilent is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Ita Unibanco Holding and Agilent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilent Technologies and Ita Unibanco 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 Ita Unibanco Holding are associated (or correlated) with Agilent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilent Technologies has no effect on the direction of Ita Unibanco i.e., Ita Unibanco and Agilent Technologies go up and down completely randomly.
Pair Corralation between Ita Unibanco and Agilent Technologies
Assuming the 90 days trading horizon Ita Unibanco Holding is expected to generate 0.62 times more return on investment than Agilent Technologies. However, Ita Unibanco Holding is 1.62 times less risky than Agilent Technologies. It trades about 0.07 of its potential returns per unit of risk. Agilent Technologies is currently generating about 0.01 per unit of risk. If you would invest 2,256 in Ita Unibanco Holding on August 23, 2024 and sell it today you would earn a total of 1,145 from holding Ita Unibanco Holding or generate 50.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 73.89% |
| Values | Daily Returns |
Ita Unibanco Holding vs. Agilent Technologies
Performance |
| Timeline |
| Ita Unibanco Holding |
| Agilent Technologies |
Ita Unibanco and Agilent Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ita Unibanco and Agilent Technologies
The main advantage of trading using opposite Ita Unibanco and Agilent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ita Unibanco position performs unexpectedly, Agilent Technologies 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 Agilent Technologies will offset losses from the drop in Agilent Technologies' long position.| Ita Unibanco vs. Banco Bradesco SA | Ita Unibanco vs. Banco do Brasil | Ita Unibanco vs. Vale SA | Ita Unibanco vs. Itasa Investimentos |
| Agilent Technologies vs. Prudential Financial | Agilent Technologies vs. Ameriprise Financial | Agilent Technologies vs. Mitsubishi UFJ Financial | Agilent Technologies vs. Metalrgica Riosulense 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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