Correlation Between CPFL Energia and Eni SpA
Can any of the company-specific risk be diversified away by investing in both CPFL Energia and Eni SpA 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 CPFL Energia and Eni SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPFL Energia SA and Eni SpA, you can compare the effects of market volatilities on CPFL Energia and Eni SpA 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 CPFL Energia with a short position of Eni SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPFL Energia and Eni SpA.
Diversification Opportunities for CPFL Energia and Eni SpA
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CPFL and Eni is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CPFL Energia SA and Eni SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eni SpA and CPFL Energia 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 CPFL Energia SA are associated (or correlated) with Eni SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eni SpA has no effect on the direction of CPFL Energia i.e., CPFL Energia and Eni SpA go up and down completely randomly.
Pair Corralation between CPFL Energia and Eni SpA
If you would invest (100.00) in Eni SpA on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Eni SpA or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CPFL Energia SA vs. Eni SpA
Performance |
| Timeline |
| CPFL Energia SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Eni SpA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
CPFL Energia and Eni SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPFL Energia and Eni SpA
The main advantage of trading using opposite CPFL Energia and Eni SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPFL Energia position performs unexpectedly, Eni SpA 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 Eni SpA will offset losses from the drop in Eni SpA's long position.| CPFL Energia vs. Q2 Holdings | CPFL Energia vs. Vacasa Inc | CPFL Energia vs. Amkor Technology | CPFL Energia vs. Kaltura |
| Eni SpA vs. SBM Offshore NV | Eni SpA vs. Allfunds Group | Eni SpA vs. Reinet Investments SCA | Eni SpA vs. Vastned Retail NV |
Check out your portfolio center.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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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