Correlation Between Brio Multiestrategi and FDO INV

Can any of the company-specific risk be diversified away by investing in both Brio Multiestrategi and FDO INV 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 Brio Multiestrategi and FDO INV into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Brio Multiestrategi Fundo and FDO INV IMOB, you can compare the effects of market volatilities on Brio Multiestrategi and FDO INV 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 Brio Multiestrategi with a short position of FDO INV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brio Multiestrategi and FDO INV.

Diversification Opportunities for Brio Multiestrategi and FDO INV

-0.2

Correlation Coefficient

Brio Multiestrategi  FDO INV

Good diversification

The 3 months correlation between Brio and FDO is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Brio Multiestrategi Fundo and FDO INV IMOB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FDO INV IMOB and Brio Multiestrategi 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 Brio Multiestrategi Fundo are associated (or correlated) with FDO INV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FDO INV IMOB has no effect on the direction of Brio Multiestrategi i.e., Brio Multiestrategi and FDO INV go up and down completely randomly.

Pair Corralation between Brio Multiestrategi and FDO INV

Assuming the 90 days trading horizon Brio Multiestrategi Fundo is expected to generate 40.67 times more return on investment than FDO INV. However, Brio Multiestrategi is 40.67 times more volatile than FDO INV IMOB. It trades about 0.34 of its potential returns per unit of risk. FDO INV IMOB is currently generating about -0.24 per unit of risk. If you would invest  636.00  in Brio Multiestrategi Fundo on October 9, 2024 and sell it today you would earn a total of  61.00  from holding Brio Multiestrategi Fundo or generate 9.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Brio Multiestrategi Fundo  vs.  FDO INV IMOB

Brio Multiestrategi Fundo

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brio Multiestrategi Fundo has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong primary indicators, Brio Multiestrategi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

FDO INV IMOB

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FDO INV IMOB are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong basic indicators, FDO INV is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Brio Multiestrategi and FDO INV

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

The idea behind Brio Multiestrategi Fundo and FDO INV IMOB 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.

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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.