Correlation Between Petroleo Brasileiro and Mobimo Hldg

Can any of the company-specific risk be diversified away by investing in both Petroleo Brasileiro and Mobimo Hldg 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 Mobimo Hldg 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 Mobimo Hldg, you can compare the effects of market volatilities on Petroleo Brasileiro and Mobimo Hldg 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 Mobimo Hldg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Petroleo Brasileiro and Mobimo Hldg.

Diversification Opportunities for Petroleo Brasileiro and Mobimo Hldg

-0.18

Correlation Coefficient

Petroleo Brasileiro  Mobimo Hldg

Good diversification

The 3 months correlation between Petroleo and Mobimo is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Petroleo Brasileiro Petrobras and Mobimo Hldg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobimo Hldg 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 Mobimo Hldg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobimo Hldg has no effect on the direction of Petroleo Brasileiro i.e., Petroleo Brasileiro and Mobimo Hldg go up and down completely randomly.

Pair Corralation between Petroleo Brasileiro and Mobimo Hldg

Considering the 90-day investment horizon Petroleo Brasileiro Petrobras is expected to generate 2.23 times more return on investment than Mobimo Hldg. However, Petroleo Brasileiro is 2.23 times more volatile than Mobimo Hldg. It trades about 0.07 of its potential returns per unit of risk. Mobimo Hldg is currently generating about 0.06 per unit of risk. If you would invest  738.00  in Petroleo Brasileiro Petrobras on October 7, 2024 and sell it today you would earn a total of  564.00  from holding Petroleo Brasileiro Petrobras or generate 76.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Petroleo Brasileiro Petrobras  vs.  Mobimo Hldg

Petroleo Brasileiro

Risk-Adjusted Performance

0 of 100

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 unfluctuating 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.

Mobimo Hldg

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Mobimo Hldg are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Mobimo Hldg may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Petroleo Brasileiro and Mobimo Hldg

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

The idea behind Petroleo Brasileiro Petrobras and Mobimo Hldg 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.