Correlation Between Petroleo Brasileiro and BANCO
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By analyzing existing cross correlation between Petroleo Brasileiro Petrobras and BANCO SANTANDER SA, you can compare the effects of market volatilities on Petroleo Brasileiro and BANCO 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 BANCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and BANCO.
Diversification Opportunities for Petroleo Brasileiro and BANCO
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Petroleo and BANCO is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and BANCO SANTANDER SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANCO SANTANDER SA 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 BANCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANCO SANTANDER SA has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and BANCO go up and down completely randomly.
Pair Corralation between Petroleo Brasileiro and BANCO
Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to generate 1.95 times more return on investment than BANCO. However, Petroleo Brasileiro is 1.95 times more volatile than BANCO SANTANDER SA. It trades about 0.05 of its potential returns per unit of risk. BANCO SANTANDER SA is currently generating about 0.01 per unit of risk. If you would invest 1,125 in Petroleo Brasileiro Petrobras on September 12, 2024 and sell it today you would earn a total of 308.00 from holding Petroleo Brasileiro Petrobras or generate 27.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 75.57% |
| Values | Daily Returns |
Petroleo Brasileiro Petrobras vs. BANCO SANTANDER SA
Performance |
| Timeline |
| Petroleo Brasileiro |
| BANCO SANTANDER SA |
Petroleo Brasileiro and BANCO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petroleo Brasileiro and BANCO
The main advantage of trading using opposite Petroleo Brasileiro and BANCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro position performs unexpectedly, BANCO 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 BANCO will offset losses from the drop in BANCO'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 |
| BANCO vs. KLA Tencor | BANCO vs. Mid Atlantic Home Health | BANCO vs. Valens | BANCO vs. Bassett Furniture Industries |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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