Correlation Between Fundo Investimento and Hedge Aaa
Can any of the company-specific risk be diversified away by investing in both Fundo Investimento and Hedge Aaa 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 Fundo Investimento and Hedge Aaa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fundo Investimento Imobiliario and Hedge Aaa Fundo, you can compare the effects of market volatilities on Fundo Investimento and Hedge Aaa 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 Fundo Investimento with a short position of Hedge Aaa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fundo Investimento and Hedge Aaa.
Diversification Opportunities for Fundo Investimento and Hedge Aaa
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fundo and Hedge is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Fundo Investimento Imobiliario and Hedge Aaa Fundo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hedge Aaa Fundo and Fundo Investimento 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 Fundo Investimento Imobiliario are associated (or correlated) with Hedge Aaa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hedge Aaa Fundo has no effect on the direction of Fundo Investimento i.e., Fundo Investimento and Hedge Aaa go up and down completely randomly.
Pair Corralation between Fundo Investimento and Hedge Aaa
Assuming the 90 days trading horizon Fundo Investimento Imobiliario is expected to under-perform the Hedge Aaa. But the fund apears to be less risky and, when comparing its historical volatility, Fundo Investimento Imobiliario is 1.28 times less risky than Hedge Aaa. The fund trades about -0.13 of its potential returns per unit of risk. The Hedge Aaa Fundo is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 2,547 in Hedge Aaa Fundo on November 28, 2024 and sell it today you would lose (31.00) from holding Hedge Aaa Fundo or give up 1.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fundo Investimento Imobiliario vs. Hedge Aaa Fundo
Performance |
| Timeline |
| Fundo Investimento |
| Hedge Aaa Fundo |
Fundo Investimento and Hedge Aaa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fundo Investimento and Hedge Aaa
The main advantage of trading using opposite Fundo Investimento and Hedge Aaa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fundo Investimento position performs unexpectedly, Hedge Aaa 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 Hedge Aaa will offset losses from the drop in Hedge Aaa's long position.| Fundo Investimento vs. BTG Pactual Logstica | Fundo Investimento vs. Btg Pactual Real | Fundo Investimento vs. KILIMA VOLKANO RECEBVEIS | Fundo Investimento vs. DEVANT PROPERTIES FUNDO |
| Hedge Aaa vs. Energisa SA | Hedge Aaa vs. BTG Pactual Logstica | Hedge Aaa vs. Plano Plano Desenvolvimento | Hedge Aaa vs. Ares Management |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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