Correlation Between Raia Drogasil and Cyrela Brazil

Can any of the company-specific risk be diversified away by investing in both Raia Drogasil and Cyrela Brazil 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 Raia Drogasil and Cyrela Brazil into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Raia Drogasil and Cyrela Brazil

-0.45

Correlation Coefficient

Raia Drogasil  Cyrela Brazil

Very good diversification

The 3 months correlation between Raia and Cyrela is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Raia Drogasil SA and Cyrela Brazil Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cyrela Brazil Realty and Raia Drogasil 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 Raia Drogasil SA are associated (or correlated) with Cyrela Brazil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cyrela Brazil Realty has no effect on the direction of Raia Drogasil i.e., Raia Drogasil and Cyrela Brazil go up and down completely randomly.

Pair Corralation between Raia Drogasil and Cyrela Brazil

Assuming the 90 days trading horizon Raia Drogasil SA is expected to under-perform the Cyrela Brazil. In addition to that, Raia Drogasil is 1.61 times more volatile than Cyrela Brazil Realty. It trades about -0.17 of its total potential returns per unit of risk. Cyrela Brazil Realty is currently generating about 0.0 per unit of volatility. If you would invest  2,588  in Cyrela Brazil Realty on April 24, 2025 and sell it today you would lose (17.00) from holding Cyrela Brazil Realty or give up 0.66% of portfolio value over 90 days.

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

Raia Drogasil SA  vs.  Cyrela Brazil Realty

Raia Drogasil SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Raia Drogasil SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in August 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Cyrela Brazil Realty

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cyrela Brazil Realty has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Cyrela Brazil is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Raia Drogasil and Cyrela Brazil

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

The idea behind Raia Drogasil SA and Cyrela Brazil Realty 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.