Correlation Between Jalles Machado and Intelbras

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

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

Diversification Opportunities for Jalles Machado and Intelbras

0.97

Correlation Coefficient

Jalles Machado  Intelbras

Almost no diversification

The 3 months correlation between Jalles and Intelbras is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Jalles Machado SA and Intelbras SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intelbras SA and Jalles Machado 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 Jalles Machado SA are associated (or correlated) with Intelbras. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intelbras SA has no effect on the direction of Jalles Machado i.e., Jalles Machado and Intelbras go up and down completely randomly.

Pair Corralation between Jalles Machado and Intelbras

Assuming the 90 days trading horizon Jalles Machado SA is expected to generate 0.77 times more return on investment than Intelbras. However, Jalles Machado SA is 1.29 times less risky than Intelbras. It trades about -0.25 of its potential returns per unit of risk. Intelbras SA is currently generating about -0.3 per unit of risk. If you would invest  511.00  in Jalles Machado SA on October 4, 2024 and sell it today you would lose (47.00) from holding Jalles Machado SA or give up 9.2% of portfolio value over 90 days.

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

Jalles Machado SA  vs.  Intelbras SA

Jalles Machado SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jalles Machado 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 February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Intelbras SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intelbras 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 Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Jalles Machado and Intelbras

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

The idea behind Jalles Machado SA and Intelbras 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.