Correlation Between Iron Mountain and BH Macro
Can any of the company-specific risk be diversified away by investing in both Iron Mountain and BH Macro 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 Iron Mountain and BH Macro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iron Mountain and BH Macro Limited, you can compare the effects of market volatilities on Iron Mountain and BH Macro 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 Iron Mountain with a short position of BH Macro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iron Mountain and BH Macro.
Diversification Opportunities for Iron Mountain and BH Macro
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Iron and BHMU is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Iron Mountain and BH Macro Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BH Macro Limited and Iron Mountain 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 Iron Mountain are associated (or correlated) with BH Macro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BH Macro Limited has no effect on the direction of Iron Mountain i.e., Iron Mountain and BH Macro go up and down completely randomly.
Pair Corralation between Iron Mountain and BH Macro
Assuming the 90 days trading horizon Iron Mountain is expected to under-perform the BH Macro. In addition to that, Iron Mountain is 1.32 times more volatile than BH Macro Limited. It trades about -0.03 of its total potential returns per unit of risk. BH Macro Limited is currently generating about 0.28 per unit of volatility. If you would invest 382.00 in BH Macro Limited on September 13, 2024 and sell it today you would earn a total of 29.00 from holding BH Macro Limited or generate 7.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Iron Mountain vs. BH Macro Limited
Performance |
| Timeline |
| Iron Mountain |
| BH Macro Limited |
Iron Mountain and BH Macro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iron Mountain and BH Macro
The main advantage of trading using opposite Iron Mountain and BH Macro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iron Mountain position performs unexpectedly, BH Macro 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 BH Macro will offset losses from the drop in BH Macro's long position.| Iron Mountain vs. Mindflair Plc | Iron Mountain vs. Cardinal Health | Iron Mountain vs. HCA Healthcare | Iron Mountain vs. Pentair PLC |
| BH Macro vs. Iron Mountain | BH Macro vs. Check Point Software | BH Macro vs. Baker Steel Resources | BH Macro vs. Spotify Technology SA |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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