Correlation Between Petroleo Brasileiro and AWILCO LNG
Can any of the company-specific risk be diversified away by investing in both Petroleo Brasileiro and AWILCO LNG 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 Petroleo Brasileiro and AWILCO LNG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petroleo Brasileiro Petrobras and AWILCO LNG NK, you can compare the effects of market volatilities on Petroleo Brasileiro and AWILCO LNG 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 Petroleo Brasileiro with a short position of AWILCO LNG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and AWILCO LNG.
Diversification Opportunities for Petroleo Brasileiro and AWILCO LNG
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Petroleo and AWILCO is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and AWILCO LNG NK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AWILCO LNG NK and Petroleo Brasileiro 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 Petroleo Brasileiro Petrobras are associated (or correlated) with AWILCO LNG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AWILCO LNG NK has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and AWILCO LNG go up and down completely randomly.
Pair Corralation between Petroleo Brasileiro and AWILCO LNG
Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to generate 0.35 times more return on investment than AWILCO LNG. However, Petroleo Brasileiro Petrobras is 2.86 times less risky than AWILCO LNG. It trades about 0.02 of its potential returns per unit of risk. AWILCO LNG NK is currently generating about 0.01 per unit of risk. If you would invest 1,362 in Petroleo Brasileiro Petrobras on September 12, 2024 and sell it today you would earn a total of 98.00 from holding Petroleo Brasileiro Petrobras or generate 7.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Petroleo Brasileiro Petrobras vs. AWILCO LNG NK
Performance |
| Timeline |
| Petroleo Brasileiro |
| AWILCO LNG NK |
Petroleo Brasileiro and AWILCO LNG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petroleo Brasileiro and AWILCO LNG
The main advantage of trading using opposite Petroleo Brasileiro and AWILCO LNG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro position performs unexpectedly, AWILCO LNG 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 AWILCO LNG will offset losses from the drop in AWILCO LNG's long position.| Petroleo Brasileiro vs. Aquagold International | Petroleo Brasileiro vs. Thrivent High Yield | Petroleo Brasileiro vs. Morningstar Unconstrained Allocation | Petroleo Brasileiro vs. Via Renewables |
| AWILCO LNG vs. GALENA MINING LTD | AWILCO LNG vs. Tower One Wireless | AWILCO LNG vs. Zijin Mining Group | AWILCO LNG vs. Consolidated Communications Holdings |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Stocks Directory Find actively traded stocks across global markets |