Correlation Between TechnipFMC Plc and Banco BTG

Can any of the company-specific risk be diversified away by investing in both TechnipFMC Plc and Banco BTG 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 TechnipFMC Plc and Banco BTG into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TechnipFMC plc and Banco BTG Pactual, you can compare the effects of market volatilities on TechnipFMC Plc and Banco BTG 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 TechnipFMC Plc with a short position of Banco BTG. Check out your portfolio center. Please also check ongoing floating volatility patterns of TechnipFMC Plc and Banco BTG.

Diversification Opportunities for TechnipFMC Plc and Banco BTG

0.67

Correlation Coefficient

TechnipFMC Plc  Banco BTG

Poor diversification

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

Pair Corralation between TechnipFMC Plc and Banco BTG

Assuming the 90 days trading horizon TechnipFMC plc is expected to generate 0.69 times more return on investment than Banco BTG. However, TechnipFMC plc is 1.45 times less risky than Banco BTG. It trades about 0.23 of its potential returns per unit of risk. Banco BTG Pactual is currently generating about 0.14 per unit of risk. If you would invest  17,603  in TechnipFMC plc on March 21, 2025 and sell it today you would earn a total of  1,373  from holding TechnipFMC plc or generate 7.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.65%
Values	Daily Returns

TechnipFMC plc  vs.  Banco BTG Pactual

TechnipFMC plc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in TechnipFMC plc are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain technical and fundamental indicators, TechnipFMC Plc sustained solid returns over the last few months and may actually be approaching a breakup point.

Banco BTG Pactual

Risk-Adjusted Performance

Insignificant

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

Pair Trading with TechnipFMC Plc and Banco BTG

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

The idea behind TechnipFMC plc and Banco BTG Pactual 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.