Correlation Between Petroleo Brasileiro and Genfit SA
Can any of the company-specific risk be diversified away by investing in both Petroleo Brasileiro and Genfit SA 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 Genfit SA 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 Genfit SA, you can compare the effects of market volatilities on Petroleo Brasileiro and Genfit SA 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 Genfit SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and Genfit SA.
Diversification Opportunities for Petroleo Brasileiro and Genfit SA
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Petroleo and Genfit is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and Genfit SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit 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 Genfit SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit SA has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and Genfit SA go up and down completely randomly.
Pair Corralation between Petroleo Brasileiro and Genfit SA
Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to generate 1.44 times more return on investment than Genfit SA. However, Petroleo Brasileiro is 1.44 times more volatile than Genfit SA. It trades about -0.13 of its potential returns per unit of risk. Genfit SA is currently generating about -0.45 per unit of risk. If you would invest 1,368 in Petroleo Brasileiro Petrobras on September 20, 2024 and sell it today you would lose (84.00) from holding Petroleo Brasileiro Petrobras or give up 6.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Petroleo Brasileiro Petrobras vs. Genfit SA
Performance |
| Timeline |
| Petroleo Brasileiro |
| Genfit SA |
Petroleo Brasileiro and Genfit SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Petroleo Brasileiro and Genfit SA
The main advantage of trading using opposite Petroleo Brasileiro and Genfit SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro position performs unexpectedly, Genfit SA 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 Genfit SA will offset losses from the drop in Genfit SA'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 |
| Genfit SA vs. BORR DRILLING NEW | Genfit SA vs. Brockhaus Capital Management | Genfit SA vs. FIREWEED METALS P | Genfit SA vs. Major Drilling Group |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |