Correlation Between Legatus Shoppings and Energisa
Can any of the company-specific risk be diversified away by investing in both Legatus Shoppings and Energisa 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 Legatus Shoppings and Energisa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legatus Shoppings Fundo and Energisa SA, you can compare the effects of market volatilities on Legatus Shoppings and Energisa 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 Legatus Shoppings with a short position of Energisa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legatus Shoppings and Energisa.
Diversification Opportunities for Legatus Shoppings and Energisa
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Legatus and Energisa is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Legatus Shoppings Fundo and Energisa SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energisa SA and Legatus Shoppings 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 Legatus Shoppings Fundo are associated (or correlated) with Energisa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energisa SA has no effect on the direction of Legatus Shoppings i.e., Legatus Shoppings and Energisa go up and down completely randomly.
Pair Corralation between Legatus Shoppings and Energisa
Assuming the 90 days trading horizon Legatus Shoppings Fundo is expected to generate 28.54 times more return on investment than Energisa. However, Legatus Shoppings is 28.54 times more volatile than Energisa SA. It trades about 0.08 of its potential returns per unit of risk. Energisa SA is currently generating about -0.07 per unit of risk. If you would invest 10,410 in Legatus Shoppings Fundo on September 2, 2024 and sell it today you would earn a total of 590.00 from holding Legatus Shoppings Fundo or generate 5.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.8% |
| Values | Daily Returns |
Legatus Shoppings Fundo vs. Energisa SA
Performance |
| Timeline |
| Legatus Shoppings Fundo |
| Energisa SA |
Legatus Shoppings and Energisa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legatus Shoppings and Energisa
The main advantage of trading using opposite Legatus Shoppings and Energisa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legatus Shoppings position performs unexpectedly, Energisa 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 Energisa will offset losses from the drop in Energisa's long position.| Legatus Shoppings vs. Real Estate Investment | Legatus Shoppings vs. NAVI CRDITO IMOBILIRIO | Legatus Shoppings vs. LIFE CAPITAL PARTNERS | Legatus Shoppings vs. Cshg Jhsf Prime |
| Energisa vs. Equatorial Energia SA | Energisa vs. CPFL Energia SA | Energisa vs. Eneva SA | Energisa vs. Companhia de Saneamento |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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