Correlation Between Bet At and Applied Materials
Can any of the company-specific risk be diversified away by investing in both Bet At and Applied Materials 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 Bet At and Applied Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between bet at home AG and Applied Materials, you can compare the effects of market volatilities on Bet At and Applied Materials 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 Bet At with a short position of Applied Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bet At and Applied Materials.
Diversification Opportunities for Bet At and Applied Materials
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bet and Applied is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding bet at home AG and Applied Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Applied Materials and Bet At 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 bet at home AG are associated (or correlated) with Applied Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Applied Materials has no effect on the direction of Bet At i.e., Bet At and Applied Materials go up and down completely randomly.
Pair Corralation between Bet At and Applied Materials
Assuming the 90 days trading horizon bet at home AG is expected to under-perform the Applied Materials. In addition to that, Bet At is 1.54 times more volatile than Applied Materials. It trades about -0.01 of its total potential returns per unit of risk. Applied Materials is currently generating about 0.03 per unit of volatility. If you would invest 14,946 in Applied Materials on September 14, 2024 and sell it today you would earn a total of 1,919 from holding Applied Materials or generate 12.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.53% |
| Values | Daily Returns |
bet at home AG vs. Applied Materials
Performance |
| Timeline |
| bet at home |
| Applied Materials |
Bet At and Applied Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bet At and Applied Materials
The main advantage of trading using opposite Bet At and Applied Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bet At position performs unexpectedly, Applied Materials 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 Applied Materials will offset losses from the drop in Applied Materials' long position.| Bet At vs. Ecofin Global Utilities | Bet At vs. Team Internet Group | Bet At vs. Tyson Foods Cl | Bet At vs. Gamma Communications PLC |
| Applied Materials vs. Verizon Communications | Applied Materials vs. Datagroup SE | Applied Materials vs. bet at home AG | Applied Materials vs. Public Storage |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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