Correlation Between Positivo Tecnologia and Kepler Weber

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

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

Diversification Opportunities for Positivo Tecnologia and Kepler Weber

0.01

Correlation Coefficient

Positivo Tecnologia  Kepler Weber

Significant diversification

The 3 months correlation between Positivo and Kepler is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Positivo Tecnologia SA and Kepler Weber SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kepler Weber SA and Positivo Tecnologia 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 Positivo Tecnologia SA are associated (or correlated) with Kepler Weber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kepler Weber SA has no effect on the direction of Positivo Tecnologia i.e., Positivo Tecnologia and Kepler Weber go up and down completely randomly.

Pair Corralation between Positivo Tecnologia and Kepler Weber

Assuming the 90 days trading horizon Positivo Tecnologia SA is expected to under-perform the Kepler Weber. In addition to that, Positivo Tecnologia is 1.65 times more volatile than Kepler Weber SA. It trades about -0.04 of its total potential returns per unit of risk. Kepler Weber SA is currently generating about -0.05 per unit of volatility. If you would invest  1,089  in Kepler Weber SA on September 13, 2024 and sell it today you would lose (78.00) from holding Kepler Weber SA or give up 7.16% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Positivo Tecnologia SA  vs.  Kepler Weber SA

Positivo Tecnologia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Positivo Tecnologia SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Kepler Weber SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kepler Weber SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Positivo Tecnologia and Kepler Weber

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

The idea behind Positivo Tecnologia SA and Kepler Weber 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.