Correlation Between Petroleo Brasileiro and Gogoro
Can any of the company-specific risk be diversified away by investing in both Petroleo Brasileiro and Gogoro 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 Gogoro 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 Gogoro Inc, you can compare the effects of market volatilities on Petroleo Brasileiro and Gogoro 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 Gogoro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and Gogoro.
Diversification Opportunities for Petroleo Brasileiro and Gogoro
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Petroleo and Gogoro is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and Gogoro Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gogoro Inc 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 Gogoro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gogoro Inc has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and Gogoro go up and down completely randomly.
Pair Corralation between Petroleo Brasileiro and Gogoro
Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to generate 0.5 times more return on investment than Gogoro. However, Petroleo Brasileiro Petrobras is 1.99 times less risky than Gogoro. It trades about 0.13 of its potential returns per unit of risk. Gogoro Inc is currently generating about -0.21 per unit of risk. If you would invest 1,275 in Petroleo Brasileiro Petrobras on December 28, 2024 and sell it today you would earn a total of 164.00 from holding Petroleo Brasileiro Petrobras or generate 12.86% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Petroleo Brasileiro Petrobras vs. Gogoro Inc
Performance |
Timeline |
Petroleo Brasileiro |
Gogoro Inc |
Petroleo Brasileiro and Gogoro Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Petroleo Brasileiro and Gogoro
The main advantage of trading using opposite Petroleo Brasileiro and Gogoro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Petroleo Brasileiro position performs unexpectedly, Gogoro 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 Gogoro will offset losses from the drop in Gogoro's long position.Petroleo Brasileiro vs. BP PLC ADR | Petroleo Brasileiro vs. Shell PLC ADR | Petroleo Brasileiro vs. Suncor Energy | Petroleo Brasileiro vs. Petrleo Brasileiro SA |
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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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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