Correlation Between BGF Retail and Nice Information
Can any of the company-specific risk be diversified away by investing in both BGF Retail and Nice Information 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 BGF Retail and Nice Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BGF Retail Co and Nice Information Telecommunication, you can compare the effects of market volatilities on BGF Retail and Nice Information 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 BGF Retail with a short position of Nice Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of BGF Retail and Nice Information.
Diversification Opportunities for BGF Retail and Nice Information
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BGF and Nice is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding BGF Retail Co and Nice Information Telecommunica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nice Information Tel and BGF Retail 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 BGF Retail Co are associated (or correlated) with Nice Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nice Information Tel has no effect on the direction of BGF Retail i.e., BGF Retail and Nice Information go up and down completely randomly.
Pair Corralation between BGF Retail and Nice Information
Assuming the 90 days trading horizon BGF Retail Co is expected to generate 1.16 times more return on investment than Nice Information. However, BGF Retail is 1.16 times more volatile than Nice Information Telecommunication. It trades about 0.1 of its potential returns per unit of risk. Nice Information Telecommunication is currently generating about 0.02 per unit of risk. If you would invest 10,360,000 in BGF Retail Co on November 27, 2024 and sell it today you would earn a total of 270,000 from holding BGF Retail Co or generate 2.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BGF Retail Co vs. Nice Information Telecommunica
Performance |
| Timeline |
| BGF Retail |
| Nice Information Tel |
BGF Retail and Nice Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BGF Retail and Nice Information
The main advantage of trading using opposite BGF Retail and Nice Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BGF Retail position performs unexpectedly, Nice Information 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 Nice Information will offset losses from the drop in Nice Information's long position.| BGF Retail vs. Cots Technology Co | BGF Retail vs. ADTechnology CoLtd | BGF Retail vs. SEOJEON ELECTRIC MACHINERY | BGF Retail vs. Kyeryong Construction Industrial |
| Nice Information vs. Soulbrain Holdings Co | Nice Information vs. NICE Total Cash | Nice Information vs. Geumhwa Plant Service | Nice Information vs. AfreecaTV Co |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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