Correlation Between Maxi Renda and Energisa
Can any of the company-specific risk be diversified away by investing in both Maxi Renda 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 Maxi Renda and Energisa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maxi Renda Fundo and Energisa SA, you can compare the effects of market volatilities on Maxi Renda 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 Maxi Renda with a short position of Energisa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maxi Renda and Energisa.
Diversification Opportunities for Maxi Renda and Energisa
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Maxi and Energisa is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Maxi Renda Fundo and Energisa SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energisa SA and Maxi Renda 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 Maxi Renda 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 Maxi Renda i.e., Maxi Renda and Energisa go up and down completely randomly.
Pair Corralation between Maxi Renda and Energisa
Assuming the 90 days trading horizon Maxi Renda Fundo is expected to generate 0.69 times more return on investment than Energisa. However, Maxi Renda Fundo is 1.45 times less risky than Energisa. It trades about -0.06 of its potential returns per unit of risk. Energisa SA is currently generating about -0.17 per unit of risk. If you would invest 955.00 in Maxi Renda Fundo on September 1, 2024 and sell it today you would lose (17.00) from holding Maxi Renda Fundo or give up 1.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Maxi Renda Fundo vs. Energisa SA
Performance |
| Timeline |
| Maxi Renda Fundo |
| Energisa SA |
Maxi Renda and Energisa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maxi Renda and Energisa
The main advantage of trading using opposite Maxi Renda and Energisa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maxi Renda 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.| Maxi Renda vs. Domo Fundo de | Maxi Renda vs. Aesapar Fundo de | Maxi Renda vs. Ourinvest Jpp Fundo | Maxi Renda vs. Loft II Fundo |
| Energisa vs. Transmissora Aliana de | Energisa vs. CTEEP Companhia | Energisa vs. Companhia Paranaense de | Energisa vs. Companhia Energtica 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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