Correlation Between Santander Renda and Xp Malls
Can any of the company-specific risk be diversified away by investing in both Santander Renda and Xp Malls 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 Santander Renda and Xp Malls into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Santander Renda De and Xp Malls Fundo, you can compare the effects of market volatilities on Santander Renda and Xp Malls 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 Santander Renda with a short position of Xp Malls. Check out your portfolio center. Please also check ongoing floating volatility patterns of Santander Renda and Xp Malls.
Diversification Opportunities for Santander Renda and Xp Malls
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Santander and XPML11 is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Santander Renda De and Xp Malls Fundo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xp Malls Fundo and Santander Renda 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 Santander Renda De are associated (or correlated) with Xp Malls. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xp Malls Fundo has no effect on the direction of Santander Renda i.e., Santander Renda and Xp Malls go up and down completely randomly.
Pair Corralation between Santander Renda and Xp Malls
Assuming the 90 days trading horizon Santander Renda De is expected to under-perform the Xp Malls. In addition to that, Santander Renda is 2.25 times more volatile than Xp Malls Fundo. It trades about -0.17 of its total potential returns per unit of risk. Xp Malls Fundo is currently generating about -0.16 per unit of volatility. If you would invest 10,378 in Xp Malls Fundo on August 30, 2024 and sell it today you would lose (178.00) from holding Xp Malls Fundo or give up 1.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Santander Renda De vs. Xp Malls Fundo
Performance |
| Timeline |
| Santander Renda De |
| Xp Malls Fundo |
Santander Renda and Xp Malls Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Santander Renda and Xp Malls
The main advantage of trading using opposite Santander Renda and Xp Malls positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Santander Renda position performs unexpectedly, Xp Malls 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 Xp Malls will offset losses from the drop in Xp Malls' long position.| Santander Renda vs. Energisa SA | Santander Renda vs. BTG Pactual Logstica | Santander Renda vs. Plano Plano Desenvolvimento | Santander Renda vs. The Procter Gamble |
| Xp Malls vs. ASA METROPOLIS FUNDO | Xp Malls vs. BB Renda Corporativa | Xp Malls vs. FUNDO DE INVESTIMENTO | Xp Malls vs. Legatus Shoppings Fundo |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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