Correlation Between Bet At and Cairn Homes
Can any of the company-specific risk be diversified away by investing in both Bet At and Cairn Homes 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 Cairn Homes 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 Cairn Homes PLC, you can compare the effects of market volatilities on Bet At and Cairn Homes 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 Cairn Homes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bet At and Cairn Homes.
Diversification Opportunities for Bet At and Cairn Homes
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bet and Cairn is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding bet at home AG and Cairn Homes PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cairn Homes PLC 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 Cairn Homes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cairn Homes PLC has no effect on the direction of Bet At i.e., Bet At and Cairn Homes go up and down completely randomly.
Pair Corralation between Bet At and Cairn Homes
Assuming the 90 days trading horizon Bet At is expected to generate 1.03 times less return on investment than Cairn Homes. In addition to that, Bet At is 2.85 times more volatile than Cairn Homes PLC. It trades about 0.03 of its total potential returns per unit of risk. Cairn Homes PLC is currently generating about 0.1 per unit of volatility. If you would invest 13,991 in Cairn Homes PLC on September 2, 2024 and sell it today you would earn a total of 3,109 from holding Cairn Homes PLC or generate 22.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
bet at home AG vs. Cairn Homes PLC
Performance |
| Timeline |
| bet at home |
| Cairn Homes PLC |
Bet At and Cairn Homes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bet At and Cairn Homes
The main advantage of trading using opposite Bet At and Cairn Homes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bet At position performs unexpectedly, Cairn Homes 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 Cairn Homes will offset losses from the drop in Cairn Homes' long position.| Bet At vs. Uniper SE | Bet At vs. Mulberry Group PLC | Bet At vs. London Security Plc | Bet At vs. Triad Group PLC |
| Cairn Homes vs. Rightmove PLC | Cairn Homes vs. Bioventix | Cairn Homes vs. VeriSign | Cairn Homes vs. Games Workshop Group |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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