Correlation Between V One and BGF Retail
Can any of the company-specific risk be diversified away by investing in both V One and BGF Retail 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 V One and BGF Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between V One Tech Co and BGF Retail Co, you can compare the effects of market volatilities on V One and BGF Retail 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 V One with a short position of BGF Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of V One and BGF Retail.
Diversification Opportunities for V One and BGF Retail
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between 251630 and BGF is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding V One Tech Co and BGF Retail Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BGF Retail and V One 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 V One Tech Co are associated (or correlated) with BGF Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BGF Retail has no effect on the direction of V One i.e., V One and BGF Retail go up and down completely randomly.
Pair Corralation between V One and BGF Retail
Assuming the 90 days trading horizon V One Tech Co is expected to generate 2.67 times more return on investment than BGF Retail. However, V One is 2.67 times more volatile than BGF Retail Co. It trades about 0.29 of its potential returns per unit of risk. BGF Retail Co is currently generating about 0.05 per unit of risk. If you would invest 396,000 in V One Tech Co on October 31, 2024 and sell it today you would earn a total of 77,000 from holding V One Tech Co or generate 19.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
V One Tech Co vs. BGF Retail Co
Performance |
| Timeline |
| V One Tech |
| BGF Retail |
V One and BGF Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with V One and BGF Retail
The main advantage of trading using opposite V One and BGF Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if V One position performs unexpectedly, BGF Retail 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 BGF Retail will offset losses from the drop in BGF Retail's long position.| V One vs. Display Tech Co | V One vs. Daishin Information Communications | V One vs. SH Energy Chemical | V One vs. Mobileleader CoLtd |
| BGF Retail vs. Formetal Co | BGF Retail vs. GS Retail Co | BGF Retail vs. Next Entertainment World | BGF Retail vs. Duksan Hi Metal |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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