Correlation Between HAGA SA and Viver Incorporadora

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

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

Diversification Opportunities for HAGA SA and Viver Incorporadora

-0.81

Correlation Coefficient

HAGA SA  Viver Incorporadora

Pay attention - limited upside

The 3 months correlation between HAGA and Viver is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding HAGA SA Indstria and Viver Incorporadora e in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viver Incorporadora and HAGA 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 HAGA SA Indstria are associated (or correlated) with Viver Incorporadora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viver Incorporadora has no effect on the direction of HAGA SA i.e., HAGA SA and Viver Incorporadora go up and down completely randomly.

Pair Corralation between HAGA SA and Viver Incorporadora

Assuming the 90 days trading horizon HAGA SA Indstria is expected to generate 0.53 times more return on investment than Viver Incorporadora. However, HAGA SA Indstria is 1.88 times less risky than Viver Incorporadora. It trades about 0.06 of its potential returns per unit of risk. Viver Incorporadora e is currently generating about -0.27 per unit of risk. If you would invest  118.00  in HAGA SA Indstria on September 5, 2024 and sell it today you would earn a total of  6.00  from holding HAGA SA Indstria or generate 5.08% return on investment over 90 days.

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

HAGA SA Indstria  vs.  Viver Incorporadora e

HAGA SA Indstria

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in HAGA SA Indstria are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, HAGA SA is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Viver Incorporadora

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with HAGA SA and Viver Incorporadora

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

The idea behind HAGA SA Indstria and Viver Incorporadora e 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.