Correlation Between BW Offshore and Batm Advanced
Can any of the company-specific risk be diversified away by investing in both BW Offshore and Batm Advanced 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 BW Offshore and Batm Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BW Offshore and Batm Advanced Communications, you can compare the effects of market volatilities on BW Offshore and Batm Advanced 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 BW Offshore with a short position of Batm Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of BW Offshore and Batm Advanced.
Diversification Opportunities for BW Offshore and Batm Advanced
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between 0RKH and Batm is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding BW Offshore and Batm Advanced Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Batm Advanced Commun and BW Offshore 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 BW Offshore are associated (or correlated) with Batm Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Batm Advanced Commun has no effect on the direction of BW Offshore i.e., BW Offshore and Batm Advanced go up and down completely randomly.
Pair Corralation between BW Offshore and Batm Advanced
Assuming the 90 days trading horizon BW Offshore is expected to generate 0.93 times more return on investment than Batm Advanced. However, BW Offshore is 1.08 times less risky than Batm Advanced. It trades about 0.32 of its potential returns per unit of risk. Batm Advanced Communications is currently generating about 0.06 per unit of risk. If you would invest 2,743 in BW Offshore on October 21, 2024 and sell it today you would earn a total of 332.00 from holding BW Offshore or generate 12.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BW Offshore vs. Batm Advanced Communications
Performance |
| Timeline |
| BW Offshore |
| Batm Advanced Commun |
BW Offshore and Batm Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BW Offshore and Batm Advanced
The main advantage of trading using opposite BW Offshore and Batm Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BW Offshore position performs unexpectedly, Batm Advanced 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 Batm Advanced will offset losses from the drop in Batm Advanced's long position.| BW Offshore vs. Geely Automobile Holdings | BW Offshore vs. Hochschild Mining plc | BW Offshore vs. Rheinmetall AG | BW Offshore vs. Atalaya Mining |
| Batm Advanced vs. Allianz Technology Trust | Batm Advanced vs. PureTech Health plc | Batm Advanced vs. Take Two Interactive Software | Batm Advanced vs. Ryanair Holdings plc |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Stocks Directory Find actively traded stocks across global markets |