Correlation Between BIT Computer and CU Medical
Can any of the company-specific risk be diversified away by investing in both BIT Computer and CU Medical 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 CU Medical 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 CU Medical Systems, you can compare the effects of market volatilities on BIT Computer and CU Medical 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 CU Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of BIT Computer and CU Medical.
Diversification Opportunities for BIT Computer and CU Medical
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BIT and 115480 is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding BIT Computer Co and CU Medical Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CU Medical Systems 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 CU Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CU Medical Systems has no effect on the direction of BIT Computer i.e., BIT Computer and CU Medical go up and down completely randomly.
Pair Corralation between BIT Computer and CU Medical
Assuming the 90 days trading horizon BIT Computer Co is expected to generate 0.82 times more return on investment than CU Medical. However, BIT Computer Co is 1.22 times less risky than CU Medical. It trades about 0.09 of its potential returns per unit of risk. CU Medical Systems is currently generating about -0.41 per unit of risk. If you would invest 486,500 in BIT Computer Co on August 29, 2024 and sell it today you would earn a total of 14,500 from holding BIT Computer Co or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BIT Computer Co vs. CU Medical Systems
Performance |
| Timeline |
| BIT Computer |
| CU Medical Systems |
BIT Computer and CU Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BIT Computer and CU Medical
The main advantage of trading using opposite BIT Computer and CU Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BIT Computer position performs unexpectedly, CU Medical 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 CU Medical will offset losses from the drop in CU Medical's long position.| BIT Computer vs. Samsung Electronics Co | BIT Computer vs. Samsung Electronics Co | BIT Computer vs. LG Energy Solution | BIT Computer vs. SK Hynix |
| CU Medical vs. Samsung Electronics Co | CU Medical vs. Samsung Electronics Co | CU Medical vs. LG Energy Solution | CU Medical vs. SK Hynix |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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