Correlation Between Marcopolo and Excelsior Alimentos
Can any of the company-specific risk be diversified away by investing in both Marcopolo and Excelsior Alimentos 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 Marcopolo and Excelsior Alimentos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marcopolo SA and Excelsior Alimentos SA, you can compare the effects of market volatilities on Marcopolo and Excelsior Alimentos 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 Marcopolo with a short position of Excelsior Alimentos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marcopolo and Excelsior Alimentos.
Diversification Opportunities for Marcopolo and Excelsior Alimentos
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Marcopolo and Excelsior is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Marcopolo SA and Excelsior Alimentos SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Excelsior Alimentos and Marcopolo 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 Marcopolo SA are associated (or correlated) with Excelsior Alimentos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Excelsior Alimentos has no effect on the direction of Marcopolo i.e., Marcopolo and Excelsior Alimentos go up and down completely randomly.
Pair Corralation between Marcopolo and Excelsior Alimentos
Assuming the 90 days trading horizon Marcopolo SA is expected to under-perform the Excelsior Alimentos. In addition to that, Marcopolo is 26.41 times more volatile than Excelsior Alimentos SA. It trades about -0.29 of its total potential returns per unit of risk. Excelsior Alimentos SA is currently generating about -0.25 per unit of volatility. If you would invest 7,879 in Excelsior Alimentos SA on October 7, 2024 and sell it today you would lose (32.00) from holding Excelsior Alimentos SA or give up 0.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marcopolo SA vs. Excelsior Alimentos SA
Performance |
| Timeline |
| Marcopolo SA |
| Excelsior Alimentos |
Marcopolo and Excelsior Alimentos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marcopolo and Excelsior Alimentos
The main advantage of trading using opposite Marcopolo and Excelsior Alimentos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marcopolo position performs unexpectedly, Excelsior Alimentos 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 Excelsior Alimentos will offset losses from the drop in Excelsior Alimentos' long position.| Marcopolo vs. METISA Metalrgica Timboense | Marcopolo vs. Recrusul SA | Marcopolo vs. Randon SA Implementos | Marcopolo vs. Energisa SA |
| Excelsior Alimentos vs. Minupar Participaes SA | Excelsior Alimentos vs. Grazziotin SA | Excelsior Alimentos vs. Banco da Amaznia | Excelsior Alimentos vs. Grazziotin 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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