Correlation Between Positivo Tecnologia and Eternit SA
Can any of the company-specific risk be diversified away by investing in both Positivo Tecnologia and Eternit 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 Positivo Tecnologia and Eternit SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Positivo Tecnologia SA and Eternit SA, you can compare the effects of market volatilities on Positivo Tecnologia and Eternit 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 Positivo Tecnologia with a short position of Eternit SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Positivo Tecnologia and Eternit SA.
Diversification Opportunities for Positivo Tecnologia and Eternit SA
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Positivo and Eternit is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Positivo Tecnologia SA and Eternit SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eternit SA and Positivo Tecnologia 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 Positivo Tecnologia SA are associated (or correlated) with Eternit SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eternit SA has no effect on the direction of Positivo Tecnologia i.e., Positivo Tecnologia and Eternit SA go up and down completely randomly.
Pair Corralation between Positivo Tecnologia and Eternit SA
Assuming the 90 days trading horizon Positivo Tecnologia SA is expected to generate 1.43 times more return on investment than Eternit SA. However, Positivo Tecnologia is 1.43 times more volatile than Eternit SA. It trades about 0.25 of its potential returns per unit of risk. Eternit SA is currently generating about 0.1 per unit of risk. If you would invest 500.00 in Positivo Tecnologia SA on October 24, 2024 and sell it today you would earn a total of 50.00 from holding Positivo Tecnologia SA or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Positivo Tecnologia SA vs. Eternit SA
Performance |
| Timeline |
| Positivo Tecnologia |
| Eternit SA |
Positivo Tecnologia and Eternit SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Positivo Tecnologia and Eternit SA
The main advantage of trading using opposite Positivo Tecnologia and Eternit SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Positivo Tecnologia position performs unexpectedly, Eternit 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 Eternit SA will offset losses from the drop in Eternit SA's long position.| Positivo Tecnologia vs. Marcopolo SA | Positivo Tecnologia vs. Gafisa SA | Positivo Tecnologia vs. Randon SA Implementos | Positivo Tecnologia vs. TOTVS SA |
| Eternit SA vs. Marcopolo SA | Eternit SA vs. Randon SA Implementos | Eternit SA vs. Companhia Siderrgica Nacional | Eternit SA vs. Positivo Tecnologia 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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