Correlation Between BRF SA and Enlightify
Can any of the company-specific risk be diversified away by investing in both BRF SA and Enlightify 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 BRF SA and Enlightify into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BRF SA ADR and Enlightify, you can compare the effects of market volatilities on BRF SA and Enlightify 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 BRF SA with a short position of Enlightify. Check out your portfolio center. Please also check ongoing floating volatility patterns of BRF SA and Enlightify.
Diversification Opportunities for BRF SA and Enlightify
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between BRF and Enlightify is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding BRF SA ADR and Enlightify in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enlightify and BRF SA 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 BRF SA ADR are associated (or correlated) with Enlightify. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enlightify has no effect on the direction of BRF SA i.e., BRF SA and Enlightify go up and down completely randomly.
Pair Corralation between BRF SA and Enlightify
Given the investment horizon of 90 days BRF SA ADR is expected to generate 0.76 times more return on investment than Enlightify. However, BRF SA ADR is 1.32 times less risky than Enlightify. It trades about 0.06 of its potential returns per unit of risk. Enlightify is currently generating about 0.02 per unit of risk. If you would invest 334.00 in BRF SA ADR on March 22, 2025 and sell it today you would earn a total of 27.00 from holding BRF SA ADR or generate 8.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.41% |
| Values | Daily Returns |
BRF SA ADR vs. Enlightify
Performance |
| Timeline |
| BRF SA ADR |
| Enlightify |
BRF SA and Enlightify Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BRF SA and Enlightify
The main advantage of trading using opposite BRF SA and Enlightify positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BRF SA position performs unexpectedly, Enlightify 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 Enlightify will offset losses from the drop in Enlightify's long position.| BRF SA vs. Marfrig Global Foods | BRF SA vs. Pilgrims Pride Corp | BRF SA vs. John B Sanfilippo | BRF SA vs. Seneca Foods Corp |
| Enlightify vs. MGIC Investment Corp | Enlightify vs. Hudson Technologies | Enlightify vs. McKesson | Enlightify vs. PennantPark Investment |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |