Correlation Between Petroleo Brasileiro and IShares MSCI
Can any of the company-specific risk be diversified away by investing in both Petroleo Brasileiro and IShares MSCI 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 IShares MSCI 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 iShares MSCI World, you can compare the effects of market volatilities on Petroleo Brasileiro and IShares MSCI 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 IShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and IShares MSCI.
Diversification Opportunities for Petroleo Brasileiro and IShares MSCI
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Petroleo and IShares is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and iShares MSCI World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares MSCI World 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 IShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares MSCI World has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and IShares MSCI go up and down completely randomly.
Pair Corralation between Petroleo Brasileiro and IShares MSCI
Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to under-perform the IShares MSCI. In addition to that, Petroleo Brasileiro is 3.72 times more volatile than iShares MSCI World. It trades about -0.06 of its total potential returns per unit of risk. iShares MSCI World is currently generating about 0.27 per unit of volatility. If you would invest 562.00 in iShares MSCI World on September 19, 2024 and sell it today you would earn a total of 18.00 from holding iShares MSCI World or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Petroleo Brasileiro Petrobras vs. iShares MSCI World
Performance |
| Timeline |
| Petroleo Brasileiro |
| iShares MSCI World |
Petroleo Brasileiro and IShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petroleo Brasileiro and IShares MSCI
The main advantage of trading using opposite Petroleo Brasileiro and IShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro position performs unexpectedly, IShares MSCI 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 IShares MSCI will offset losses from the drop in IShares MSCI'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 |
| IShares MSCI vs. Lyxor UCITS Japan | IShares MSCI vs. Lyxor UCITS Japan | IShares MSCI vs. Lyxor UCITS Stoxx | IShares MSCI vs. Amundi CAC 40 |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |