Correlation Between Fundo Invest and ConocoPhillips

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

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

Diversification Opportunities for Fundo Invest and ConocoPhillips

-0.58

Correlation Coefficient

Fundo Invest  ConocoPhillips

Excellent diversification

The 3 months correlation between Fundo and ConocoPhillips is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Fundo Invest Imobiliario and ConocoPhillips in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ConocoPhillips and Fundo Invest 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 Invest Imobiliario are associated (or correlated) with ConocoPhillips. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ConocoPhillips has no effect on the direction of Fundo Invest i.e., Fundo Invest and ConocoPhillips go up and down completely randomly.

Pair Corralation between Fundo Invest and ConocoPhillips

Assuming the 90 days trading horizon Fundo Invest Imobiliario is expected to generate 3.08 times more return on investment than ConocoPhillips. However, Fundo Invest is 3.08 times more volatile than ConocoPhillips. It trades about 0.1 of its potential returns per unit of risk. ConocoPhillips is currently generating about -0.09 per unit of risk. If you would invest  585.00  in Fundo Invest Imobiliario on September 25, 2024 and sell it today you would earn a total of  54.00  from holding Fundo Invest Imobiliario or generate 9.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Fundo Invest Imobiliario  vs.  ConocoPhillips

Fundo Invest Imobiliario

Risk-Adjusted Performance

0 of 100

Very Weak

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

ConocoPhillips

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ConocoPhillips are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, ConocoPhillips is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Fundo Invest and ConocoPhillips

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

The idea behind Fundo Invest Imobiliario and ConocoPhillips 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..