Correlation Between Marcopolo and Pettenati
Can any of the company-specific risk be diversified away by investing in both Marcopolo and Pettenati 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 Pettenati into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marcopolo SA and Pettenati SA Industria, you can compare the effects of market volatilities on Marcopolo and Pettenati 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 Pettenati. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marcopolo and Pettenati.
Diversification Opportunities for Marcopolo and Pettenati
Poor diversification
The 3 months correlation between Marcopolo and Pettenati is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Marcopolo SA and Pettenati SA Industria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pettenati SA Industria 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 Pettenati. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pettenati SA Industria has no effect on the direction of Marcopolo i.e., Marcopolo and Pettenati go up and down completely randomly.
Pair Corralation between Marcopolo and Pettenati
Assuming the 90 days trading horizon Marcopolo SA is expected to under-perform the Pettenati. In addition to that, Marcopolo is 1.27 times more volatile than Pettenati SA Industria. It trades about -0.26 of its total potential returns per unit of risk. Pettenati SA Industria is currently generating about -0.22 per unit of volatility. If you would invest 665.00 in Pettenati SA Industria on October 16, 2024 and sell it today you would lose (103.00) from holding Pettenati SA Industria or give up 15.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.3% |
| Values | Daily Returns |
Marcopolo SA vs. Pettenati SA Industria
Performance |
| Timeline |
| Marcopolo SA |
| Pettenati SA Industria |
Marcopolo and Pettenati Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marcopolo and Pettenati
The main advantage of trading using opposite Marcopolo and Pettenati positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marcopolo position performs unexpectedly, Pettenati 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 Pettenati will offset losses from the drop in Pettenati's long position.| Marcopolo vs. Randon SA Implementos | Marcopolo vs. Metalurgica Gerdau SA | Marcopolo vs. CCR SA | Marcopolo vs. Embraer SA |
| Pettenati vs. Schulz SA | Pettenati vs. Springs Global Participaes | Pettenati vs. Grazziotin SA | Pettenati vs. Companhia de Tecidos |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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