Correlation Between BGF Retail and QUALITAS SEMICONDUCTOR
Can any of the company-specific risk be diversified away by investing in both BGF Retail and QUALITAS SEMICONDUCTOR 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 QUALITAS SEMICONDUCTOR 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 QUALITAS SEMICONDUCTOR LTD, you can compare the effects of market volatilities on BGF Retail and QUALITAS SEMICONDUCTOR 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 QUALITAS SEMICONDUCTOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of BGF Retail and QUALITAS SEMICONDUCTOR.
Diversification Opportunities for BGF Retail and QUALITAS SEMICONDUCTOR
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BGF and QUALITAS is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding BGF Retail Co and QUALITAS SEMICONDUCTOR LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QUALITAS SEMICONDUCTOR 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 QUALITAS SEMICONDUCTOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QUALITAS SEMICONDUCTOR has no effect on the direction of BGF Retail i.e., BGF Retail and QUALITAS SEMICONDUCTOR go up and down completely randomly.
Pair Corralation between BGF Retail and QUALITAS SEMICONDUCTOR
Assuming the 90 days trading horizon BGF Retail Co is expected to generate 0.74 times more return on investment than QUALITAS SEMICONDUCTOR. However, BGF Retail Co is 1.36 times less risky than QUALITAS SEMICONDUCTOR. It trades about -0.08 of its potential returns per unit of risk. QUALITAS SEMICONDUCTOR LTD is currently generating about -0.48 per unit of risk. If you would invest 11,200,000 in BGF Retail Co on August 29, 2024 and sell it today you would lose (500,000) from holding BGF Retail Co or give up 4.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BGF Retail Co vs. QUALITAS SEMICONDUCTOR LTD
Performance |
| Timeline |
| BGF Retail |
| QUALITAS SEMICONDUCTOR |
BGF Retail and QUALITAS SEMICONDUCTOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BGF Retail and QUALITAS SEMICONDUCTOR
The main advantage of trading using opposite BGF Retail and QUALITAS SEMICONDUCTOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BGF Retail position performs unexpectedly, QUALITAS SEMICONDUCTOR 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 QUALITAS SEMICONDUCTOR will offset losses from the drop in QUALITAS SEMICONDUCTOR's long position.| BGF Retail vs. AptaBio Therapeutics | BGF Retail vs. Daewoo SBI SPAC | BGF Retail vs. Dream Security co | BGF Retail vs. Microfriend |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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