Correlation Between BE Semiconductor and Revolution Beauty
Can any of the company-specific risk be diversified away by investing in both BE Semiconductor and Revolution Beauty 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 Revolution Beauty 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 Revolution Beauty Group, you can compare the effects of market volatilities on BE Semiconductor and Revolution Beauty 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 Revolution Beauty. Check out your portfolio center. Please also check ongoing floating volatility patterns of BE Semiconductor and Revolution Beauty.
Diversification Opportunities for BE Semiconductor and Revolution Beauty
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between 0XVE and Revolution is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding BE Semiconductor Industries and Revolution Beauty Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Revolution Beauty 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 Revolution Beauty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Revolution Beauty has no effect on the direction of BE Semiconductor i.e., BE Semiconductor and Revolution Beauty go up and down completely randomly.
Pair Corralation between BE Semiconductor and Revolution Beauty
Assuming the 90 days trading horizon BE Semiconductor Industries is expected to generate 0.75 times more return on investment than Revolution Beauty. However, BE Semiconductor Industries is 1.33 times less risky than Revolution Beauty. It trades about 0.07 of its potential returns per unit of risk. Revolution Beauty Group is currently generating about 0.0 per unit of risk. If you would invest 5,415 in BE Semiconductor Industries on September 12, 2024 and sell it today you would earn a total of 7,195 from holding BE Semiconductor Industries or generate 132.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
BE Semiconductor Industries vs. Revolution Beauty Group
Performance |
| Timeline |
| BE Semiconductor Ind |
| Revolution Beauty |
BE Semiconductor and Revolution Beauty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BE Semiconductor and Revolution Beauty
The main advantage of trading using opposite BE Semiconductor and Revolution Beauty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BE Semiconductor position performs unexpectedly, Revolution Beauty 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 Revolution Beauty will offset losses from the drop in Revolution Beauty's long position.| BE Semiconductor vs. Hong Kong Land | BE Semiconductor vs. Neometals | BE Semiconductor vs. Coor Service Management | BE Semiconductor vs. Fidelity Sustainable USD |
| Revolution Beauty vs. BE Semiconductor Industries | Revolution Beauty vs. Jupiter Fund Management | Revolution Beauty vs. Coor Service Management | Revolution Beauty vs. Nordic Semiconductor ASA |
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 Stocks Directory module to find actively traded stocks across global markets.
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