Correlation Between Kinea Oportunidades and Fator IFIX

Can any of the company-specific risk be diversified away by investing in both Kinea Oportunidades and Fator IFIX 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 Kinea Oportunidades and Fator IFIX into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kinea Oportunidades Real and Fator IFIX Fundo, you can compare the effects of market volatilities on Kinea Oportunidades and Fator IFIX 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 Kinea Oportunidades with a short position of Fator IFIX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinea Oportunidades and Fator IFIX.

Diversification Opportunities for Kinea Oportunidades and Fator IFIX

0.25

Correlation Coefficient

Kinea Oportunidades  Fator IFIX

Modest diversification

The 3 months correlation between Kinea and Fator is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Kinea Oportunidades Real and Fator IFIX Fundo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fator IFIX Fundo and Kinea Oportunidades 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 Kinea Oportunidades Real are associated (or correlated) with Fator IFIX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fator IFIX Fundo has no effect on the direction of Kinea Oportunidades i.e., Kinea Oportunidades and Fator IFIX go up and down completely randomly.

Pair Corralation between Kinea Oportunidades and Fator IFIX

Assuming the 90 days trading horizon Kinea Oportunidades Real is expected to under-perform the Fator IFIX. In addition to that, Kinea Oportunidades is 1.08 times more volatile than Fator IFIX Fundo. It trades about -0.07 of its total potential returns per unit of risk. Fator IFIX Fundo is currently generating about 0.1 per unit of volatility. If you would invest  4,854  in Fator IFIX Fundo on April 22, 2025 and sell it today you would earn a total of  332.00  from holding Fator IFIX Fundo or generate 6.84% return on investment over 90 days.

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

Kinea Oportunidades Real  vs.  Fator IFIX Fundo

Kinea Oportunidades Real

Risk-Adjusted Performance

Very Weak

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

Fator IFIX Fundo

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fator IFIX Fundo are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak technical and fundamental indicators, Fator IFIX may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Kinea Oportunidades and Fator IFIX

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

The idea behind Kinea Oportunidades Real and Fator IFIX Fundo 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.