Correlation Between Emerald Expositions and TIM Participacoes

Can any of the company-specific risk be diversified away by investing in both Emerald Expositions and TIM Participacoes 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 Emerald Expositions and TIM Participacoes into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Emerald Expositions Events and TIM Participacoes SA, you can compare the effects of market volatilities on Emerald Expositions and TIM Participacoes 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 Emerald Expositions with a short position of TIM Participacoes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerald Expositions and TIM Participacoes.

Diversification Opportunities for Emerald Expositions and TIM Participacoes

-0.05

Correlation Coefficient

Emerald Expositions  TIM Participacoes

Good diversification

The 3 months correlation between Emerald and TIM is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Emerald Expositions Events and TIM Participacoes SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TIM Participacoes and Emerald Expositions 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 Emerald Expositions Events are associated (or correlated) with TIM Participacoes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TIM Participacoes has no effect on the direction of Emerald Expositions i.e., Emerald Expositions and TIM Participacoes go up and down completely randomly.

Pair Corralation between Emerald Expositions and TIM Participacoes

Considering the 90-day investment horizon Emerald Expositions Events is expected to under-perform the TIM Participacoes. But the stock apears to be less risky and, when comparing its historical volatility, Emerald Expositions Events is 1.17 times less risky than TIM Participacoes. The stock trades about -0.21 of its potential returns per unit of risk. The TIM Participacoes SA is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest  2,113  in TIM Participacoes SA on July 15, 2025 and sell it today you would lose (59.00) from holding TIM Participacoes SA or give up 2.79% of portfolio value over 90 days.

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

Emerald Expositions Events  vs.  TIM Participacoes SA

Emerald Expositions

Risk-Adjusted Performance

Weakest

Over the last 90 days Emerald Expositions Events has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong technical and fundamental indicators, Emerald Expositions is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

TIM Participacoes

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in TIM Participacoes SA are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain primary indicators, TIM Participacoes may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Pair Trading with Emerald Expositions and TIM Participacoes

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

The idea behind Emerald Expositions Events and TIM Participacoes SA 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.