Correlation Between BIT Computer and NICE Information
Can any of the company-specific risk be diversified away by investing in both BIT Computer and NICE Information 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 BIT Computer and NICE Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BIT Computer Co and NICE Information Service, you can compare the effects of market volatilities on BIT Computer and NICE Information 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 BIT Computer with a short position of NICE Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of BIT Computer and NICE Information.
Diversification Opportunities for BIT Computer and NICE Information
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BIT and NICE is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding BIT Computer Co and NICE Information Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NICE Information Service and BIT Computer 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 BIT Computer Co are associated (or correlated) with NICE Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NICE Information Service has no effect on the direction of BIT Computer i.e., BIT Computer and NICE Information go up and down completely randomly.
Pair Corralation between BIT Computer and NICE Information
Assuming the 90 days trading horizon BIT Computer Co is expected to under-perform the NICE Information. In addition to that, BIT Computer is 1.35 times more volatile than NICE Information Service. It trades about -0.04 of its total potential returns per unit of risk. NICE Information Service is currently generating about 0.05 per unit of volatility. If you would invest 1,047,000 in NICE Information Service on November 3, 2024 and sell it today you would earn a total of 180,000 from holding NICE Information Service or generate 17.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BIT Computer Co vs. NICE Information Service
Performance |
| Timeline |
| BIT Computer |
| NICE Information Service |
BIT Computer and NICE Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BIT Computer and NICE Information
The main advantage of trading using opposite BIT Computer and NICE Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BIT Computer position performs unexpectedly, NICE Information 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 NICE Information will offset losses from the drop in NICE Information's long position.| BIT Computer vs. Dongwoo Farm To | BIT Computer vs. Cuckoo Homesys Co | BIT Computer vs. Keyang Electric Machinery | BIT Computer vs. KT Submarine Telecom |
| NICE Information vs. Wonil Special Steel | NICE Information vs. Hyundai BNG Steel | NICE Information vs. Cuckoo Homesys Co | NICE Information vs. Hyundai Home Shopping |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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