Correlation Between Cia De and Unipar Carbocloro

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

By analyzing existing cross correlation between Cia de Ferro and Unipar Carbocloro SA, you can compare the effects of market volatilities on Cia De and Unipar Carbocloro 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 Cia De with a short position of Unipar Carbocloro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cia De and Unipar Carbocloro.

Diversification Opportunities for Cia De and Unipar Carbocloro

-0.13

Correlation Coefficient

Cia De  Unipar Carbocloro

Good diversification

The 3 months correlation between Cia and Unipar is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Cia de Ferro and Unipar Carbocloro SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unipar Carbocloro and Cia De 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 Cia de Ferro are associated (or correlated) with Unipar Carbocloro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unipar Carbocloro has no effect on the direction of Cia De i.e., Cia De and Unipar Carbocloro go up and down completely randomly.

Pair Corralation between Cia De and Unipar Carbocloro

Assuming the 90 days trading horizon Cia de Ferro is expected to generate 1.27 times more return on investment than Unipar Carbocloro. However, Cia De is 1.27 times more volatile than Unipar Carbocloro SA. It trades about 0.0 of its potential returns per unit of risk. Unipar Carbocloro SA is currently generating about -0.11 per unit of risk. If you would invest  756.00  in Cia de Ferro on December 2, 2024 and sell it today you would lose (10.00) from holding Cia de Ferro or give up 1.32% of portfolio value over 90 days.

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

Cia de Ferro  vs.  Unipar Carbocloro SA

Cia de Ferro

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cia de Ferro has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cia De is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Unipar Carbocloro

Risk-Adjusted Performance

Very Weak

Over the last 90 days Unipar Carbocloro SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Preferred Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Cia De and Unipar Carbocloro

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

The idea behind Cia de Ferro and Unipar Carbocloro SA 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.