Correlation Between JHSF Participaes and Unipar Carbocloro

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

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

Diversification Opportunities for JHSF Participaes and Unipar Carbocloro

0.67

Correlation Coefficient

JHSF Participaes  Unipar Carbocloro

Poor diversification

The 3 months correlation between JHSF and Unipar is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding JHSF Participaes SA and Unipar Carbocloro SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unipar Carbocloro and JHSF Participaes 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 JHSF Participaes SA are associated (or correlated) with Unipar Carbocloro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unipar Carbocloro has no effect on the direction of JHSF Participaes i.e., JHSF Participaes and Unipar Carbocloro go up and down completely randomly.

Pair Corralation between JHSF Participaes and Unipar Carbocloro

Assuming the 90 days trading horizon JHSF Participaes SA is expected to generate 1.43 times more return on investment than Unipar Carbocloro. However, JHSF Participaes is 1.43 times more volatile than Unipar Carbocloro SA. It trades about 0.06 of its potential returns per unit of risk. Unipar Carbocloro SA is currently generating about 0.04 per unit of risk. If you would invest  459.00  in JHSF Participaes SA on April 23, 2025 and sell it today you would earn a total of  36.00  from holding JHSF Participaes SA or generate 7.84% return on investment over 90 days.

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

JHSF Participaes SA  vs.  Unipar Carbocloro SA

JHSF Participaes

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JHSF Participaes SA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, JHSF Participaes may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Unipar Carbocloro

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Unipar Carbocloro SA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Unipar Carbocloro is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with JHSF Participaes and Unipar Carbocloro

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

The idea behind JHSF Participaes SA and Unipar Carbocloro 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.