Correlation Between Kinea High and BTG Pactual
Can any of the company-specific risk be diversified away by investing in both Kinea High and BTG Pactual 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 Kinea High and BTG Pactual into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinea High Yield and BTG Pactual Logstica, you can compare the effects of market volatilities on Kinea High and BTG Pactual 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 Kinea High with a short position of BTG Pactual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinea High and BTG Pactual.
Diversification Opportunities for Kinea High and BTG Pactual
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kinea and BTG is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Kinea High Yield and BTG Pactual Logstica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTG Pactual Logstica and Kinea High 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 Kinea High Yield are associated (or correlated) with BTG Pactual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTG Pactual Logstica has no effect on the direction of Kinea High i.e., Kinea High and BTG Pactual go up and down completely randomly.
Pair Corralation between Kinea High and BTG Pactual
Assuming the 90 days trading horizon Kinea High Yield is expected to generate 2.38 times more return on investment than BTG Pactual. However, Kinea High is 2.38 times more volatile than BTG Pactual Logstica. It trades about 0.03 of its potential returns per unit of risk. BTG Pactual Logstica is currently generating about -0.05 per unit of risk. If you would invest 8,303 in Kinea High Yield on September 12, 2024 and sell it today you would earn a total of 1,405 from holding Kinea High Yield or generate 16.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinea High Yield vs. BTG Pactual Logstica
Performance |
| Timeline |
| Kinea High Yield |
| BTG Pactual Logstica |
Kinea High and BTG Pactual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinea High and BTG Pactual
The main advantage of trading using opposite Kinea High and BTG Pactual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinea High position performs unexpectedly, BTG Pactual 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 BTG Pactual will offset losses from the drop in BTG Pactual's long position.| Kinea High vs. BTG Pactual Logstica | Kinea High vs. Plano Plano Desenvolvimento | Kinea High vs. Companhia Habitasul de | Kinea High vs. FDO INV IMOB |
| BTG Pactual vs. BTG Pactual Teva | BTG Pactual vs. BTG PACTUAL CRDITO | BTG Pactual vs. FDO INV IMOB | BTG Pactual vs. SUPREMO FUNDO DE |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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