Correlation Between Petroleo Brasileiro and STKD Bitcoin
Can any of the company-specific risk be diversified away by investing in both Petroleo Brasileiro and STKD Bitcoin 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 STKD Bitcoin 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 STKD Bitcoin Gold, you can compare the effects of market volatilities on Petroleo Brasileiro and STKD Bitcoin 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 STKD Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and STKD Bitcoin.
Diversification Opportunities for Petroleo Brasileiro and STKD Bitcoin
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Petroleo and STKD is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and STKD Bitcoin Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STKD Bitcoin Gold 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 STKD Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STKD Bitcoin Gold has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and STKD Bitcoin go up and down completely randomly.
Pair Corralation between Petroleo Brasileiro and STKD Bitcoin
Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to under-perform the STKD Bitcoin. But the stock apears to be less risky and, when comparing its historical volatility, Petroleo Brasileiro Petrobras is 1.9 times less risky than STKD Bitcoin. The stock trades about -0.06 of its potential returns per unit of risk. The STKD Bitcoin Gold is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 2,661 in STKD Bitcoin Gold on September 18, 2024 and sell it today you would earn a total of 404.00 from holding STKD Bitcoin Gold or generate 15.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Petroleo Brasileiro Petrobras vs. STKD Bitcoin Gold
Performance |
| Timeline |
| Petroleo Brasileiro |
| STKD Bitcoin Gold |
Petroleo Brasileiro and STKD Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petroleo Brasileiro and STKD Bitcoin
The main advantage of trading using opposite Petroleo Brasileiro and STKD Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro position performs unexpectedly, STKD Bitcoin 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 STKD Bitcoin will offset losses from the drop in STKD Bitcoin's long position.| Petroleo Brasileiro vs. Ecopetrol SA ADR | Petroleo Brasileiro vs. Equinor ASA ADR | Petroleo Brasileiro vs. Eni SpA ADR | Petroleo Brasileiro vs. Cenovus Energy |
| STKD Bitcoin vs. Freedom Day Dividend | STKD Bitcoin vs. Franklin Templeton ETF | STKD Bitcoin vs. iShares MSCI China | STKD Bitcoin vs. Tidal Trust II |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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