Correlation Between Burelle SA and Altamir SCA

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

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

Diversification Opportunities for Burelle SA and Altamir SCA

0.54

Correlation Coefficient

Burelle SA  Altamir SCA

Very weak diversification

The 3 months correlation between Burelle and Altamir is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Burelle SA and Altamir SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altamir SCA and Burelle 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 Burelle SA are associated (or correlated) with Altamir SCA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altamir SCA has no effect on the direction of Burelle SA i.e., Burelle SA and Altamir SCA go up and down completely randomly.

Pair Corralation between Burelle SA and Altamir SCA

Assuming the 90 days trading horizon Burelle SA is expected to under-perform the Altamir SCA. In addition to that, Burelle SA is 1.38 times more volatile than Altamir SCA. It trades about -0.08 of its total potential returns per unit of risk. Altamir SCA is currently generating about -0.03 per unit of volatility. If you would invest  2,440  in Altamir SCA on September 2, 2024 and sell it today you would lose (90.00) from holding Altamir SCA or give up 3.69% of portfolio value over 90 days.

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

Burelle SA  vs.  Altamir SCA

Burelle SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Burelle SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Altamir SCA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Altamir SCA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Altamir SCA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Burelle SA and Altamir SCA

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

The idea behind Burelle SA and Altamir SCA 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.