Correlation Between Fundo Investimento and BS2 ALLINVESTMENTS

Can any of the company-specific risk be diversified away by investing in both Fundo Investimento and BS2 ALLINVESTMENTS 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 Fundo Investimento and BS2 ALLINVESTMENTS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fundo Investimento Imobiliario and BS2 ALLINVESTMENTS FDO, you can compare the effects of market volatilities on Fundo Investimento and BS2 ALLINVESTMENTS 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 Fundo Investimento with a short position of BS2 ALLINVESTMENTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fundo Investimento and BS2 ALLINVESTMENTS.

Diversification Opportunities for Fundo Investimento and BS2 ALLINVESTMENTS

-0.12

Correlation Coefficient

Fundo Investimento  BS2 ALLINVESTMENTS

Good diversification

The 3 months correlation between Fundo and BS2 is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Fundo Investimento Imobiliario and BS2 ALLINVESTMENTS FDO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BS2 ALLINVESTMENTS FDO and Fundo Investimento 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 Fundo Investimento Imobiliario are associated (or correlated) with BS2 ALLINVESTMENTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BS2 ALLINVESTMENTS FDO has no effect on the direction of Fundo Investimento i.e., Fundo Investimento and BS2 ALLINVESTMENTS go up and down completely randomly.

Pair Corralation between Fundo Investimento and BS2 ALLINVESTMENTS

Assuming the 90 days trading horizon Fundo Investimento Imobiliario is expected to generate 1.32 times more return on investment than BS2 ALLINVESTMENTS. However, Fundo Investimento is 1.32 times more volatile than BS2 ALLINVESTMENTS FDO. It trades about 0.03 of its potential returns per unit of risk. BS2 ALLINVESTMENTS FDO is currently generating about 0.01 per unit of risk. If you would invest  7,164  in Fundo Investimento Imobiliario on October 21, 2024 and sell it today you would earn a total of  1,286  from holding Fundo Investimento Imobiliario or generate 17.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.23%
Values	Daily Returns

Fundo Investimento Imobiliario  vs.  BS2 ALLINVESTMENTS FDO

Fundo Investimento

Risk-Adjusted Performance

0 of 100

Very Weak

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

BS2 ALLINVESTMENTS FDO

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BS2 ALLINVESTMENTS FDO has generated negative risk-adjusted returns adding no value to fund investors. Despite weak performance in the last few months, the Fund's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Fundo Investimento and BS2 ALLINVESTMENTS

The main advantage of trading using opposite Fundo Investimento and BS2 ALLINVESTMENTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fundo Investimento position performs unexpectedly, BS2 ALLINVESTMENTS 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 BS2 ALLINVESTMENTS will offset losses from the drop in BS2 ALLINVESTMENTS's long position.

The idea behind Fundo Investimento Imobiliario and BS2 ALLINVESTMENTS FDO 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.