Correlation Between Raontech and BGF Retail
Can any of the company-specific risk be diversified away by investing in both Raontech 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 Raontech and BGF Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raontech and BGF Retail Co, you can compare the effects of market volatilities on Raontech 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 Raontech with a short position of BGF Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raontech and BGF Retail.
Diversification Opportunities for Raontech and BGF Retail
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Raontech and BGF is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Raontech and BGF Retail Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BGF Retail and Raontech 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 Raontech 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 Raontech i.e., Raontech and BGF Retail go up and down completely randomly.
Pair Corralation between Raontech and BGF Retail
Assuming the 90 days trading horizon Raontech is expected to generate 2.52 times more return on investment than BGF Retail. However, Raontech is 2.52 times more volatile than BGF Retail Co. It trades about 0.25 of its potential returns per unit of risk. BGF Retail Co is currently generating about 0.0 per unit of risk. If you would invest 314,000 in Raontech on October 16, 2024 and sell it today you would earn a total of 62,000 from holding Raontech or generate 19.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Raontech vs. BGF Retail Co
Performance |
| Timeline |
| Raontech |
| BGF Retail |
Raontech and BGF Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raontech and BGF Retail
The main advantage of trading using opposite Raontech and BGF Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raontech 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.| Raontech vs. RF Materials Co | Raontech vs. Daeduck Electronics Co | Raontech vs. Cuckoo Electronics Co | Raontech vs. Wave Electronics Co |
| BGF Retail vs. Korea Steel Co | BGF Retail vs. INSUN Environmental New | BGF Retail vs. Han Kook Steel | BGF Retail vs. Korea Information 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |