Correlation Between FDO INV and BTG Pactual

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

By analyzing existing cross correlation between FDO INV IMOB and BTG Pactual Logstica, you can compare the effects of market volatilities on FDO INV and BTG Pactual 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 FDO INV with a short position of BTG Pactual. Check out your portfolio center. Please also check ongoing floating volatility patterns of FDO INV and BTG Pactual.

Diversification Opportunities for FDO INV and BTG Pactual

0.0

Correlation Coefficient

FDO INV  BTG Pactual

Pay attention - limited upside

The 3 months correlation between FDO and BTG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FDO INV IMOB and BTG Pactual Logstica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTG Pactual Logstica and FDO INV 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 FDO INV IMOB are associated (or correlated) with BTG Pactual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTG Pactual Logstica has no effect on the direction of FDO INV i.e., FDO INV and BTG Pactual go up and down completely randomly.

Pair Corralation between FDO INV and BTG Pactual

If you would invest (100.00) in FDO INV IMOB on September 15, 2024 and sell it today you would earn a total of  100.00  from holding FDO INV IMOB or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

FDO INV IMOB  vs.  BTG Pactual Logstica

FDO INV IMOB

Risk-Adjusted Performance

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Weak

Over the last 90 days FDO INV IMOB has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong fundamental indicators, FDO INV is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

BTG Pactual Logstica

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with FDO INV and BTG Pactual

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

The idea behind FDO INV IMOB and BTG Pactual Logstica 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.