Correlation Between Marcopolo and PBG SA
Can any of the company-specific risk be diversified away by investing in both Marcopolo and PBG 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 Marcopolo and PBG SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marcopolo SA and PBG SA, you can compare the effects of market volatilities on Marcopolo and PBG 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 Marcopolo with a short position of PBG SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marcopolo and PBG SA.
Diversification Opportunities for Marcopolo and PBG SA
Pay attention - limited upside
The 3 months correlation between Marcopolo and PBG is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Marcopolo SA and PBG SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PBG SA 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 PBG SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PBG SA has no effect on the direction of Marcopolo i.e., Marcopolo and PBG SA go up and down completely randomly.
Pair Corralation between Marcopolo and PBG SA
Assuming the 90 days trading horizon Marcopolo SA is expected to generate 0.74 times more return on investment than PBG SA. However, Marcopolo SA is 1.36 times less risky than PBG SA. It trades about 0.11 of its potential returns per unit of risk. PBG SA is currently generating about -0.09 per unit of risk. If you would invest 756.00 in Marcopolo SA on September 2, 2024 and sell it today you would earn a total of 103.00 from holding Marcopolo SA or generate 13.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marcopolo SA vs. PBG SA
Performance |
| Timeline |
| Marcopolo SA |
| PBG SA |
Marcopolo and PBG SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marcopolo and PBG SA
The main advantage of trading using opposite Marcopolo and PBG SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marcopolo position performs unexpectedly, PBG 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 PBG SA will offset losses from the drop in PBG SA's long position.| Marcopolo vs. Randon SA Implementos | Marcopolo vs. Metalurgica Gerdau SA | Marcopolo vs. CCR SA | Marcopolo vs. Iochpe Maxion SA |
| PBG SA vs. METISA Metalrgica Timboense | PBG SA vs. Lupatech SA | PBG SA vs. Fras le SA | PBG SA vs. Energisa 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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