Correlation Between Suburban Propane and Companhia Paranaense
Can any of the company-specific risk be diversified away by investing in both Suburban Propane and Companhia Paranaense 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 Suburban Propane and Companhia Paranaense into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Suburban Propane Partners and Companhia Paranaense de, you can compare the effects of market volatilities on Suburban Propane and Companhia Paranaense 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 Suburban Propane with a short position of Companhia Paranaense. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suburban Propane and Companhia Paranaense.
Diversification Opportunities for Suburban Propane and Companhia Paranaense
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Suburban and Companhia is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Suburban Propane Partners and Companhia Paranaense de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Companhia Paranaense and Suburban Propane 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 Suburban Propane Partners are associated (or correlated) with Companhia Paranaense. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Companhia Paranaense has no effect on the direction of Suburban Propane i.e., Suburban Propane and Companhia Paranaense go up and down completely randomly.
Pair Corralation between Suburban Propane and Companhia Paranaense
Considering the 90-day investment horizon Suburban Propane Partners is expected to generate 0.78 times more return on investment than Companhia Paranaense. However, Suburban Propane Partners is 1.28 times less risky than Companhia Paranaense. It trades about 0.04 of its potential returns per unit of risk. Companhia Paranaense de is currently generating about -0.05 per unit of risk. If you would invest 1,364 in Suburban Propane Partners on October 10, 2024 and sell it today you would earn a total of 400.00 from holding Suburban Propane Partners or generate 29.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 51.92% |
| Values | Daily Returns |
Suburban Propane Partners vs. Companhia Paranaense de
Performance |
| Timeline |
| Suburban Propane Partners |
| Companhia Paranaense |
Suburban Propane and Companhia Paranaense Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suburban Propane and Companhia Paranaense
The main advantage of trading using opposite Suburban Propane and Companhia Paranaense positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suburban Propane position performs unexpectedly, Companhia Paranaense 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 Companhia Paranaense will offset losses from the drop in Companhia Paranaense's long position.| Suburban Propane vs. Northwest Natural Gas | Suburban Propane vs. NewJersey Resources | Suburban Propane vs. Atmos Energy | Suburban Propane vs. Chesapeake Utilities |
| Companhia Paranaense vs. Consol Energy | Companhia Paranaense vs. American Airlines Group | Companhia Paranaense vs. Azul SA | Companhia Paranaense vs. Copa Holdings 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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