Correlation Between Lojas Quero and CVC Brasil

Can any of the company-specific risk be diversified away by investing in both Lojas Quero and CVC Brasil 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 Lojas Quero and CVC Brasil into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Lojas Quero and CVC Brasil

-0.15

Correlation Coefficient

Lojas Quero  CVC Brasil

Good diversification

The 3 months correlation between Lojas and CVC is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Lojas Quero Quero SA and CVC Brasil Operadora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVC Brasil Operadora and Lojas Quero 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 Lojas Quero Quero SA are associated (or correlated) with CVC Brasil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVC Brasil Operadora has no effect on the direction of Lojas Quero i.e., Lojas Quero and CVC Brasil go up and down completely randomly.

Pair Corralation between Lojas Quero and CVC Brasil

Assuming the 90 days trading horizon Lojas Quero Quero SA is expected to under-perform the CVC Brasil. In addition to that, Lojas Quero is 1.05 times more volatile than CVC Brasil Operadora. It trades about -0.05 of its total potential returns per unit of risk. CVC Brasil Operadora is currently generating about 0.05 per unit of volatility. If you would invest  220.00  in CVC Brasil Operadora on April 22, 2025 and sell it today you would earn a total of  19.00  from holding CVC Brasil Operadora or generate 8.64% return on investment over 90 days.

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

Lojas Quero Quero SA  vs.  CVC Brasil Operadora

Lojas Quero Quero

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lojas Quero Quero 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.

CVC Brasil Operadora

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in CVC Brasil Operadora are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CVC Brasil may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Lojas Quero and CVC Brasil

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

The idea behind Lojas Quero Quero SA and CVC Brasil Operadora 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.