Correlation Between Helbor Empreendimentos and Tecnisa SA

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

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

Diversification Opportunities for Helbor Empreendimentos and Tecnisa SA

0.73

Correlation Coefficient

Helbor Empreendimentos  Tecnisa SA

Poor diversification

The 3 months correlation between Helbor and Tecnisa is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Helbor Empreendimentos SA and Tecnisa SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tecnisa SA and Helbor Empreendimentos 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 Helbor Empreendimentos SA are associated (or correlated) with Tecnisa SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tecnisa SA has no effect on the direction of Helbor Empreendimentos i.e., Helbor Empreendimentos and Tecnisa SA go up and down completely randomly.

Pair Corralation between Helbor Empreendimentos and Tecnisa SA

Assuming the 90 days trading horizon Helbor Empreendimentos SA is expected to under-perform the Tecnisa SA. In addition to that, Helbor Empreendimentos is 1.06 times more volatile than Tecnisa SA. It trades about -0.22 of its total potential returns per unit of risk. Tecnisa SA is currently generating about 0.0 per unit of volatility. If you would invest  138.00  in Tecnisa SA on August 31, 2024 and sell it today you would lose (2.00) from holding Tecnisa SA or give up 1.45% of portfolio value over 90 days.

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

Helbor Empreendimentos SA  vs.  Tecnisa SA

Helbor Empreendimentos

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Helbor Empreendimentos SA 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 December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Tecnisa SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tecnisa SA 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 December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Helbor Empreendimentos and Tecnisa SA

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

The idea behind Helbor Empreendimentos SA and Tecnisa 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.