Correlation Between Panatlntica and Marcopolo
Can any of the company-specific risk be diversified away by investing in both Panatlntica and Marcopolo 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 Panatlntica and Marcopolo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Panatlntica SA and Marcopolo SA, you can compare the effects of market volatilities on Panatlntica and Marcopolo 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 Panatlntica with a short position of Marcopolo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Panatlntica and Marcopolo.
Diversification Opportunities for Panatlntica and Marcopolo
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Panatlntica and Marcopolo is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Panatlntica SA and Marcopolo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marcopolo SA and Panatlntica 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 Panatlntica SA are associated (or correlated) with Marcopolo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marcopolo SA has no effect on the direction of Panatlntica i.e., Panatlntica and Marcopolo go up and down completely randomly.
Pair Corralation between Panatlntica and Marcopolo
Assuming the 90 days trading horizon Panatlntica SA is expected to generate 2.9 times more return on investment than Marcopolo. However, Panatlntica is 2.9 times more volatile than Marcopolo SA. It trades about 0.04 of its potential returns per unit of risk. Marcopolo SA is currently generating about 0.07 per unit of risk. If you would invest 2,450 in Panatlntica SA on August 27, 2024 and sell it today you would earn a total of 250.00 from holding Panatlntica SA or generate 10.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 68.25% |
| Values | Daily Returns |
Panatlntica SA vs. Marcopolo SA
Performance |
| Timeline |
| Panatlntica SA |
| Marcopolo SA |
Panatlntica and Marcopolo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Panatlntica and Marcopolo
The main advantage of trading using opposite Panatlntica and Marcopolo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Panatlntica position performs unexpectedly, Marcopolo 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 Marcopolo will offset losses from the drop in Marcopolo's long position.| Panatlntica vs. Companhia de Gs | Panatlntica vs. Rede Energia Participaes | Panatlntica vs. CTEEP Companhia | Panatlntica vs. Rio Paranapanema Energia |
| Marcopolo vs. Marcopolo SA | Marcopolo vs. Randon SA Implementos | Marcopolo vs. Randon SA Implementos | Marcopolo vs. Klabin 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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