Correlation Between Mliuz SA and Auren Energia

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

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

Diversification Opportunities for Mliuz SA and Auren Energia

0.6

Correlation Coefficient

Mliuz SA  Auren Energia

Poor diversification

The 3 months correlation between Mliuz and Auren is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Mliuz SA and Auren Energia SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auren Energia SA and Mliuz SA 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 Mliuz SA are associated (or correlated) with Auren Energia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auren Energia SA has no effect on the direction of Mliuz SA i.e., Mliuz SA and Auren Energia go up and down completely randomly.

Pair Corralation between Mliuz SA and Auren Energia

Assuming the 90 days trading horizon Mliuz SA is expected to generate 4.0 times more return on investment than Auren Energia. However, Mliuz SA is 4.0 times more volatile than Auren Energia SA. It trades about 0.08 of its potential returns per unit of risk. Auren Energia SA is currently generating about 0.09 per unit of risk. If you would invest  511.00  in Mliuz SA on April 24, 2025 and sell it today you would earn a total of  114.00  from holding Mliuz SA or generate 22.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Mliuz SA  vs.  Auren Energia SA

Mliuz SA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mliuz SA are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Mliuz SA unveiled solid returns over the last few months and may actually be approaching a breakup point.

Auren Energia SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Auren Energia SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Auren Energia may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Mliuz SA and Auren Energia

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

The idea behind Mliuz SA and Auren Energia 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.