Correlation Between BE Semiconductor and Bell Food
Can any of the company-specific risk be diversified away by investing in both BE Semiconductor and Bell Food 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 BE Semiconductor and Bell Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BE Semiconductor Industries and Bell Food Group, you can compare the effects of market volatilities on BE Semiconductor and Bell Food 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 BE Semiconductor with a short position of Bell Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of BE Semiconductor and Bell Food.
Diversification Opportunities for BE Semiconductor and Bell Food
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 0XVE and Bell is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding BE Semiconductor Industries and Bell Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bell Food Group and BE Semiconductor 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 BE Semiconductor Industries are associated (or correlated) with Bell Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bell Food Group has no effect on the direction of BE Semiconductor i.e., BE Semiconductor and Bell Food go up and down completely randomly.
Pair Corralation between BE Semiconductor and Bell Food
Assuming the 90 days trading horizon BE Semiconductor Industries is expected to generate 2.07 times more return on investment than Bell Food. However, BE Semiconductor is 2.07 times more volatile than Bell Food Group. It trades about 0.11 of its potential returns per unit of risk. Bell Food Group is currently generating about -0.07 per unit of risk. If you would invest 11,388 in BE Semiconductor Industries on October 30, 2024 and sell it today you would earn a total of 1,175 from holding BE Semiconductor Industries or generate 10.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BE Semiconductor Industries vs. Bell Food Group
Performance |
| Timeline |
| BE Semiconductor Ind |
| Bell Food Group |
BE Semiconductor and Bell Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BE Semiconductor and Bell Food
The main advantage of trading using opposite BE Semiconductor and Bell Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BE Semiconductor position performs unexpectedly, Bell Food 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 Bell Food will offset losses from the drop in Bell Food's long position.| BE Semiconductor vs. Fulcrum Metals PLC | BE Semiconductor vs. Wheaton Precious Metals | BE Semiconductor vs. URU Metals | BE Semiconductor vs. Eastinco Mining Exploration |
| Bell Food vs. Ross Stores | Bell Food vs. EVS Broadcast Equipment | Bell Food vs. European Metals Holdings | Bell Food vs. Gaztransport et Technigaz |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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