Correlation Between Lojas Quero and Eneva SA
Can any of the company-specific risk be diversified away by investing in both Lojas Quero and Eneva SA 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 Lojas Quero and Eneva SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lojas Quero Quero SA and Eneva SA, you can compare the effects of market volatilities on Lojas Quero and Eneva SA 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 Lojas Quero with a short position of Eneva SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lojas Quero and Eneva SA.
Diversification Opportunities for Lojas Quero and Eneva SA
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lojas and Eneva is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Lojas Quero Quero SA and Eneva SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eneva SA and Lojas Quero 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 Lojas Quero Quero SA are associated (or correlated) with Eneva SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eneva SA has no effect on the direction of Lojas Quero i.e., Lojas Quero and Eneva SA go up and down completely randomly.
Pair Corralation between Lojas Quero and Eneva SA
Assuming the 90 days trading horizon Lojas Quero Quero SA is expected to under-perform the Eneva SA. In addition to that, Lojas Quero is 1.69 times more volatile than Eneva SA. It trades about -0.14 of its total potential returns per unit of risk. Eneva SA is currently generating about -0.06 per unit of volatility. If you would invest 1,350 in Eneva SA on November 2, 2024 and sell it today you would lose (177.00) from holding Eneva SA or give up 13.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.03% |
| Values | Daily Returns |
Lojas Quero Quero SA vs. Eneva SA
Performance |
| Timeline |
| Lojas Quero Quero |
| Eneva SA |
Lojas Quero and Eneva SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lojas Quero and Eneva SA
The main advantage of trading using opposite Lojas Quero and Eneva SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lojas Quero position performs unexpectedly, Eneva SA 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 Eneva SA will offset losses from the drop in Eneva SA's long position.| Lojas Quero vs. Mobly SA | Lojas Quero vs. Enjoei SA | Lojas Quero vs. Bemobi Mobile Tech | Lojas Quero vs. MPM Corpreos SA |
| Eneva SA vs. Banco BTG Pactual | Eneva SA vs. Cosan SA | Eneva SA vs. Banco Pan SA | Eneva SA vs. Equatorial Energia 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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