Correlation Between Transportadora and Franchise
Can any of the company-specific risk be diversified away by investing in both Transportadora and Franchise 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 Transportadora and Franchise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transportadora de Gas and Franchise Group, you can compare the effects of market volatilities on Transportadora and Franchise 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 Transportadora with a short position of Franchise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transportadora and Franchise.
Diversification Opportunities for Transportadora and Franchise
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Transportadora and Franchise is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Transportadora de Gas and Franchise Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franchise Group and Transportadora 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 Transportadora de Gas are associated (or correlated) with Franchise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franchise Group has no effect on the direction of Transportadora i.e., Transportadora and Franchise go up and down completely randomly.
Pair Corralation between Transportadora and Franchise
If you would invest 1,918 in Transportadora de Gas on September 2, 2024 and sell it today you would earn a total of 1,054 from holding Transportadora de Gas or generate 54.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 1.56% |
| Values | Daily Returns |
Transportadora de Gas vs. Franchise Group
Performance |
| Timeline |
| Transportadora de Gas |
| Franchise Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Transportadora and Franchise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transportadora and Franchise
The main advantage of trading using opposite Transportadora and Franchise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transportadora position performs unexpectedly, Franchise 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 Franchise will offset losses from the drop in Franchise's long position.| Transportadora vs. Petroleo Brasileiro Petrobras | Transportadora vs. Ecopetrol SA ADR | Transportadora vs. Petrleo Brasileiro SA | Transportadora vs. Equinor ASA ADR |
| Franchise vs. Harmony Gold Mining | Franchise vs. Chester Mining | Franchise vs. Shake Shack | Franchise vs. Summit Materials |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| CEOs Directory Screen CEOs from public companies around the world |