Correlation Between Transportadora and One Gas
Can any of the company-specific risk be diversified away by investing in both Transportadora and One Gas 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 One Gas 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 One Gas, you can compare the effects of market volatilities on Transportadora and One Gas 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 One Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transportadora and One Gas.
Diversification Opportunities for Transportadora and One Gas
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Transportadora and One is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Transportadora de Gas and One Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on One Gas 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 One Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of One Gas has no effect on the direction of Transportadora i.e., Transportadora and One Gas go up and down completely randomly.
Pair Corralation between Transportadora and One Gas
Considering the 90-day investment horizon Transportadora de Gas is expected to generate 1.84 times more return on investment than One Gas. However, Transportadora is 1.84 times more volatile than One Gas. It trades about 0.42 of its potential returns per unit of risk. One Gas is currently generating about 0.37 per unit of risk. If you would invest 2,342 in Transportadora de Gas on September 3, 2024 and sell it today you would earn a total of 630.00 from holding Transportadora de Gas or generate 26.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Transportadora de Gas vs. One Gas
Performance |
| Timeline |
| Transportadora de Gas |
| One Gas |
Transportadora and One Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transportadora and One Gas
The main advantage of trading using opposite Transportadora and One Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transportadora position performs unexpectedly, One Gas 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 One Gas will offset losses from the drop in One Gas' long position.| Transportadora vs. Petroleo Brasileiro Petrobras | Transportadora vs. Ecopetrol SA ADR | Transportadora vs. Petrleo Brasileiro SA | Transportadora vs. Equinor ASA ADR |
| One Gas vs. Northwest Natural Gas | One Gas vs. Chesapeake Utilities | One Gas vs. NewJersey Resources | One Gas vs. RGC Resources |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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