Correlation Between BNK Financial and A Tech
Can any of the company-specific risk be diversified away by investing in both BNK Financial and A Tech 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 BNK Financial and A Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BNK Financial Group and A Tech Solution Co, you can compare the effects of market volatilities on BNK Financial and A Tech 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 BNK Financial with a short position of A Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNK Financial and A Tech.
Diversification Opportunities for BNK Financial and A Tech
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BNK and 071670 is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding BNK Financial Group and A Tech Solution Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A Tech Solution and BNK Financial 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 BNK Financial Group are associated (or correlated) with A Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A Tech Solution has no effect on the direction of BNK Financial i.e., BNK Financial and A Tech go up and down completely randomly.
Pair Corralation between BNK Financial and A Tech
Assuming the 90 days trading horizon BNK Financial Group is expected to generate 0.65 times more return on investment than A Tech. However, BNK Financial Group is 1.54 times less risky than A Tech. It trades about 0.09 of its potential returns per unit of risk. A Tech Solution Co is currently generating about -0.07 per unit of risk. If you would invest 626,883 in BNK Financial Group on August 28, 2024 and sell it today you would earn a total of 369,117 from holding BNK Financial Group or generate 58.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.71% |
| Values | Daily Returns |
BNK Financial Group vs. A Tech Solution Co
Performance |
| Timeline |
| BNK Financial Group |
| A Tech Solution |
BNK Financial and A Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNK Financial and A Tech
The main advantage of trading using opposite BNK Financial and A Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNK Financial position performs unexpectedly, A Tech 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 A Tech will offset losses from the drop in A Tech's long position.| BNK Financial vs. Korea New Network | BNK Financial vs. Dong A Eltek | BNK Financial vs. Dreamus Company | BNK Financial vs. SK Bioscience Co |
| A Tech vs. Daedong Metals Co | A Tech vs. Hanjin Transportation Co | A Tech vs. LG Chemicals | A Tech vs. Nable Communications |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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