Correlation Between Multilaser Industrial and British American
Can any of the company-specific risk be diversified away by investing in both Multilaser Industrial and British American 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 Multilaser Industrial and British American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multilaser Industrial SA and British American Tobacco, you can compare the effects of market volatilities on Multilaser Industrial and British American 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 Multilaser Industrial with a short position of British American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multilaser Industrial and British American.
Diversification Opportunities for Multilaser Industrial and British American
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Multilaser and British is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Multilaser Industrial SA and British American Tobacco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on British American Tobacco and Multilaser Industrial 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 Multilaser Industrial SA are associated (or correlated) with British American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of British American Tobacco has no effect on the direction of Multilaser Industrial i.e., Multilaser Industrial and British American go up and down completely randomly.
Pair Corralation between Multilaser Industrial and British American
Assuming the 90 days trading horizon Multilaser Industrial SA is expected to under-perform the British American. In addition to that, Multilaser Industrial is 2.71 times more volatile than British American Tobacco. It trades about -0.02 of its total potential returns per unit of risk. British American Tobacco is currently generating about 0.02 per unit of volatility. If you would invest 3,747 in British American Tobacco on August 23, 2024 and sell it today you would earn a total of 540.00 from holding British American Tobacco or generate 14.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Multilaser Industrial SA vs. British American Tobacco
Performance |
| Timeline |
| Multilaser Industrial |
| British American Tobacco |
Multilaser Industrial and British American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multilaser Industrial and British American
The main advantage of trading using opposite Multilaser Industrial and British American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multilaser Industrial position performs unexpectedly, British American 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 British American will offset losses from the drop in British American's long position.| Multilaser Industrial vs. Intelbras SA | Multilaser Industrial vs. Razen SA | Multilaser Industrial vs. Pet Center Comrcio | Multilaser Industrial vs. Locaweb Servios de |
| British American vs. BTG Pactual Logstica | British American vs. Plano Plano Desenvolvimento | British American vs. Companhia Habitasul de | British American vs. The Procter Gamble |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |