Correlation Between PBG SA and Iochpe Maxion
Can any of the company-specific risk be diversified away by investing in both PBG SA and Iochpe Maxion 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 PBG SA and Iochpe Maxion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PBG SA and Iochpe Maxion SA, you can compare the effects of market volatilities on PBG SA and Iochpe Maxion 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 PBG SA with a short position of Iochpe Maxion. Check out your portfolio center. Please also check ongoing floating volatility patterns of PBG SA and Iochpe Maxion.
Diversification Opportunities for PBG SA and Iochpe Maxion
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between PBG and Iochpe is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding PBG SA and Iochpe Maxion SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iochpe Maxion SA and PBG SA 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 PBG SA are associated (or correlated) with Iochpe Maxion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iochpe Maxion SA has no effect on the direction of PBG SA i.e., PBG SA and Iochpe Maxion go up and down completely randomly.
Pair Corralation between PBG SA and Iochpe Maxion
Assuming the 90 days trading horizon PBG SA is expected to under-perform the Iochpe Maxion. In addition to that, PBG SA is 1.61 times more volatile than Iochpe Maxion SA. It trades about -0.02 of its total potential returns per unit of risk. Iochpe Maxion SA is currently generating about 0.19 per unit of volatility. If you would invest 1,039 in Iochpe Maxion SA on August 31, 2024 and sell it today you would earn a total of 101.00 from holding Iochpe Maxion SA or generate 9.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PBG SA vs. Iochpe Maxion SA
Performance |
| Timeline |
| PBG SA |
| Iochpe Maxion SA |
PBG SA and Iochpe Maxion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PBG SA and Iochpe Maxion
The main advantage of trading using opposite PBG SA and Iochpe Maxion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PBG SA position performs unexpectedly, Iochpe Maxion 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 Iochpe Maxion will offset losses from the drop in Iochpe Maxion's long position.| PBG SA vs. METISA Metalrgica Timboense | PBG SA vs. Lupatech SA | PBG SA vs. Fras le SA | PBG SA vs. Energisa SA |
| Iochpe Maxion vs. METISA Metalrgica Timboense | Iochpe Maxion vs. Lupatech SA | Iochpe Maxion vs. Fras le SA | Iochpe Maxion 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |