Correlation Between Ita Unibanco and Lupatech
Can any of the company-specific risk be diversified away by investing in both Ita Unibanco and Lupatech 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 Lupatech 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 Lupatech SA, you can compare the effects of market volatilities on Ita Unibanco and Lupatech 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 Lupatech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ita Unibanco and Lupatech.
Diversification Opportunities for Ita Unibanco and Lupatech
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ita and Lupatech is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Ita Unibanco Holding and Lupatech SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lupatech SA 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 Lupatech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lupatech SA has no effect on the direction of Ita Unibanco i.e., Ita Unibanco and Lupatech go up and down completely randomly.
Pair Corralation between Ita Unibanco and Lupatech
Assuming the 90 days trading horizon Ita Unibanco Holding is expected to generate 0.77 times more return on investment than Lupatech. However, Ita Unibanco Holding is 1.29 times less risky than Lupatech. It trades about -0.23 of its potential returns per unit of risk. Lupatech SA is currently generating about -0.4 per unit of risk. If you would invest 3,376 in Ita Unibanco Holding on September 24, 2024 and sell it today you would lose (287.00) from holding Ita Unibanco Holding or give up 8.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ita Unibanco Holding vs. Lupatech SA
Performance |
| Timeline |
| Ita Unibanco Holding |
| Lupatech SA |
Ita Unibanco and Lupatech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ita Unibanco and Lupatech
The main advantage of trading using opposite Ita Unibanco and Lupatech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ita Unibanco position performs unexpectedly, Lupatech 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 Lupatech will offset losses from the drop in Lupatech's long position.| Ita Unibanco vs. Banco Bradesco SA | Ita Unibanco vs. Banco do Brasil | Ita Unibanco vs. Vale SA | Ita Unibanco vs. Itasa Investimentos |
| Lupatech vs. Ita Unibanco Holding | Lupatech vs. Ita Unibanco Holding | Lupatech vs. Banco Santander SA | Lupatech vs. Banco Santander 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |