Correlation Between PDG Realty and Cosan SA
Can any of the company-specific risk be diversified away by investing in both PDG Realty and Cosan 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 PDG Realty and Cosan SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PDG Realty SA and Cosan SA, you can compare the effects of market volatilities on PDG Realty and Cosan 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 PDG Realty with a short position of Cosan SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of PDG Realty and Cosan SA.
Diversification Opportunities for PDG Realty and Cosan SA
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PDG and Cosan is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding PDG Realty SA and Cosan SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosan SA and PDG Realty 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 PDG Realty SA are associated (or correlated) with Cosan SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cosan SA has no effect on the direction of PDG Realty i.e., PDG Realty and Cosan SA go up and down completely randomly.
Pair Corralation between PDG Realty and Cosan SA
If you would invest 1.00 in PDG Realty SA on September 14, 2024 and sell it today you would earn a total of 0.00 from holding PDG Realty SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PDG Realty SA vs. Cosan SA
Performance |
| Timeline |
| PDG Realty SA |
| Cosan SA |
PDG Realty and Cosan SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PDG Realty and Cosan SA
The main advantage of trading using opposite PDG Realty and Cosan SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PDG Realty position performs unexpectedly, Cosan 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 Cosan SA will offset losses from the drop in Cosan SA's long position.| PDG Realty vs. Tupy SA | PDG Realty vs. Engie Brasil Energia | PDG Realty vs. Grendene SA | PDG Realty vs. M Dias Branco |
| Cosan SA vs. PDG Realty SA | Cosan SA vs. Positivo Tecnologia SA | Cosan SA vs. Rossi Residencial SA | Cosan SA vs. Gafisa SA |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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