Correlation Between Petroleo Brasileiro and SICC

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Petroleo Brasileiro and SICC 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 Petroleo Brasileiro and SICC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Petroleo Brasileiro Petrobras and SICC Co, you can compare the effects of market volatilities on Petroleo Brasileiro and SICC 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 Petroleo Brasileiro with a short position of SICC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and SICC.

Diversification Opportunities for Petroleo Brasileiro and SICC

-0.16
  Correlation Coefficient

Good diversification

The 3 months correlation between Petroleo and SICC is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and SICC Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SICC and Petroleo Brasileiro 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 Petroleo Brasileiro Petrobras are associated (or correlated) with SICC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SICC has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and SICC go up and down completely randomly.

Pair Corralation between Petroleo Brasileiro and SICC

Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to generate 0.55 times more return on investment than SICC. However, Petroleo Brasileiro Petrobras is 1.83 times less risky than SICC. It trades about 0.01 of its potential returns per unit of risk. SICC Co is currently generating about 0.0 per unit of risk. If you would invest  1,250  in Petroleo Brasileiro Petrobras on October 1, 2024 and sell it today you would earn a total of  11.00  from holding Petroleo Brasileiro Petrobras or generate 0.88% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy97.23%
ValuesDaily Returns

Petroleo Brasileiro Petrobras  vs.  SICC Co

 Performance 
       Timeline  
Petroleo Brasileiro 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Petroleo Brasileiro Petrobras has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's fundamental drivers remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.
SICC 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days SICC Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Petroleo Brasileiro and SICC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Petroleo Brasileiro and SICC

The main advantage of trading using opposite Petroleo Brasileiro and SICC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro position performs unexpectedly, SICC 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 SICC will offset losses from the drop in SICC's long position.
The idea behind Petroleo Brasileiro Petrobras and SICC Co 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.
Check out your portfolio center.
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

Other Complementary Tools

Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Stock Screener
Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
CEOs Directory
Screen CEOs from public companies around the world
Commodity Channel
Use Commodity Channel Index to analyze current equity momentum