Correlation Between COPEL PNB and BRADESCO

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both COPEL PNB and BRADESCO 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 COPEL PNB and BRADESCO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COPEL PNB N1 and BRADESCO PN EJ, you can compare the effects of market volatilities on COPEL PNB and BRADESCO 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 COPEL PNB with a short position of BRADESCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of COPEL PNB and BRADESCO.

Diversification Opportunities for COPEL PNB and BRADESCO

-0.64
  Correlation Coefficient

Excellent diversification

The 3 months correlation between COPEL and BRADESCO is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding COPEL PNB N1 and BRADESCO PN EJ N1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRADESCO PN EJ and COPEL PNB 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 COPEL PNB N1 are associated (or correlated) with BRADESCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRADESCO PN EJ has no effect on the direction of COPEL PNB i.e., COPEL PNB and BRADESCO go up and down completely randomly.

Pair Corralation between COPEL PNB and BRADESCO

Assuming the 90 days trading horizon COPEL PNB N1 is expected to generate 1.39 times more return on investment than BRADESCO. However, COPEL PNB is 1.39 times more volatile than BRADESCO PN EJ. It trades about 0.12 of its potential returns per unit of risk. BRADESCO PN EJ is currently generating about -0.24 per unit of risk. If you would invest  726.00  in COPEL PNB N1 on August 28, 2022 and sell it today you would earn a total of  91.00  from holding COPEL PNB N1 or generate 12.53% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy95.24%
ValuesDaily Returns

COPEL PNB N1  vs.  BRADESCO PN EJ N1

 Performance (%) 
       Timeline  
COPEL PNB N1 
COPEL Performance
6 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in COPEL PNB N1 are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, COPEL PNB reported solid returns over the last few months and may actually be approaching a breakup point.

COPEL Price Channel

BRADESCO PN EJ 
BRADESCO Performance
0 of 100
Over the last 90 days BRADESCO PN EJ has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in December 2022. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

BRADESCO Price Channel

COPEL PNB and BRADESCO Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with COPEL PNB and BRADESCO

The main advantage of trading using opposite COPEL PNB and BRADESCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COPEL PNB position performs unexpectedly, BRADESCO 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 BRADESCO will offset losses from the drop in BRADESCO's long position.
COPEL PNB vs. CEMIG PN N1
COPEL PNB vs. ABC BRASIL PN
COPEL PNB vs. BRASKEM PNB N1
COPEL PNB vs. AURA 360 DR3
The idea behind COPEL PNB N1 and BRADESCO PN EJ 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.
BRADESCO vs. AURA 360 DR3
BRADESCO vs. BRASKEM PNB N1
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.

Other Complementary Tools

Analyst Recommendations
Analyst recommendations and target price estimates broken down by several categories
Go
Watchlist Optimization
Optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm
Go
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Go
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Go
Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Go