Correlation Between Maxi Renda and Oi SA

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

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

Diversification Opportunities for Maxi Renda and Oi SA

-0.22

Correlation Coefficient

Maxi Renda  Oi SA

Very good diversification

The 3 months correlation between Maxi and OIBR3 is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Maxi Renda Fundo and Oi SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oi SA and Maxi Renda 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 Maxi Renda Fundo are associated (or correlated) with Oi SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oi SA has no effect on the direction of Maxi Renda i.e., Maxi Renda and Oi SA go up and down completely randomly.

Pair Corralation between Maxi Renda and Oi SA

Assuming the 90 days trading horizon Maxi Renda Fundo is expected to generate 0.25 times more return on investment than Oi SA. However, Maxi Renda Fundo is 4.0 times less risky than Oi SA. It trades about -0.01 of its potential returns per unit of risk. Oi SA is currently generating about -0.12 per unit of risk. If you would invest  919.00  in Maxi Renda Fundo on December 30, 2024 and sell it today you would lose (5.00) from holding Maxi Renda Fundo or give up 0.54% of portfolio value over 90 days.

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

Maxi Renda Fundo  vs.  Oi SA

Maxi Renda Fundo

Risk-Adjusted Performance

Very Weak

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

Oi SA

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Maxi Renda and Oi SA

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

The idea behind Maxi Renda Fundo and Oi 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.