Correlation Between Braskem SA and Sisecam Resources

Can any of the company-specific risk be diversified away by investing in both Braskem SA and Sisecam Resources 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 Braskem SA and Sisecam Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Braskem SA Class and Sisecam Resources LP, you can compare the effects of market volatilities on Braskem SA and Sisecam Resources 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 Braskem SA with a short position of Sisecam Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Braskem SA and Sisecam Resources.

Diversification Opportunities for Braskem SA and Sisecam Resources

-0.88

Correlation Coefficient

Braskem SA  Sisecam Resources

Pay attention - limited upside

The 3 months correlation between Braskem and Sisecam is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Braskem SA Class and Sisecam Resources LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sisecam Resources and Braskem SA 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 Braskem SA Class are associated (or correlated) with Sisecam Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sisecam Resources has no effect on the direction of Braskem SA i.e., Braskem SA and Sisecam Resources go up and down completely randomly.

Pair Corralation between Braskem SA and Sisecam Resources

If you would invest  2,533  in Sisecam Resources LP on September 3, 2024 and sell it today you would earn a total of  0.00  from holding Sisecam Resources LP or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	1.56%
Values	Daily Returns

Braskem SA Class  vs.  Sisecam Resources LP

Braskem SA Class

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Braskem SA Class has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Sisecam Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sisecam Resources LP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Sisecam Resources is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Braskem SA and Sisecam Resources

The main advantage of trading using opposite Braskem SA and Sisecam Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Braskem SA position performs unexpectedly, Sisecam Resources 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 Sisecam Resources will offset losses from the drop in Sisecam Resources' long position.

The idea behind Braskem SA Class and Sisecam Resources LP pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.