Correlation Between RB Capital and Energisa

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

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

Diversification Opportunities for RB Capital and Energisa

0.0

Correlation Coefficient

RB Capital  Energisa

Pay attention - limited upside

The 3 months correlation between RBCO11 and Energisa is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding RB Capital Office and Energisa SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energisa SA and RB Capital 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 RB Capital Office are associated (or correlated) with Energisa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energisa SA has no effect on the direction of RB Capital i.e., RB Capital and Energisa go up and down completely randomly.

Pair Corralation between RB Capital and Energisa

If you would invest  4,400  in RB Capital Office on September 5, 2024 and sell it today you would earn a total of  0.00  from holding RB Capital Office or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

RB Capital Office  vs.  Energisa SA

RB Capital Office

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days RB Capital Office has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, RB Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Energisa SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Energisa SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's technical and fundamental 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.

Pair Trading with RB Capital and Energisa

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

The idea behind RB Capital Office and Energisa 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 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.