Correlation Between Brighten Optix and BenQ Medical
Can any of the company-specific risk be diversified away by investing in both Brighten Optix and BenQ Medical 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 Brighten Optix and BenQ Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brighten Optix and BenQ Medical Technology, you can compare the effects of market volatilities on Brighten Optix and BenQ Medical 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 Brighten Optix with a short position of BenQ Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brighten Optix and BenQ Medical.
Diversification Opportunities for Brighten Optix and BenQ Medical
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Brighten and BenQ is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Brighten Optix and BenQ Medical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BenQ Medical Technology and Brighten Optix 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 Brighten Optix are associated (or correlated) with BenQ Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BenQ Medical Technology has no effect on the direction of Brighten Optix i.e., Brighten Optix and BenQ Medical go up and down completely randomly.
Pair Corralation between Brighten Optix and BenQ Medical
Assuming the 90 days trading horizon Brighten Optix is expected to under-perform the BenQ Medical. In addition to that, Brighten Optix is 1.27 times more volatile than BenQ Medical Technology. It trades about -0.17 of its total potential returns per unit of risk. BenQ Medical Technology is currently generating about -0.16 per unit of volatility. If you would invest 4,950 in BenQ Medical Technology on September 4, 2024 and sell it today you would lose (150.00) from holding BenQ Medical Technology or give up 3.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brighten Optix vs. BenQ Medical Technology
Performance |
| Timeline |
| Brighten Optix |
| BenQ Medical Technology |
Brighten Optix and BenQ Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brighten Optix and BenQ Medical
The main advantage of trading using opposite Brighten Optix and BenQ Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brighten Optix position performs unexpectedly, BenQ Medical 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 BenQ Medical will offset losses from the drop in BenQ Medical's long position.| Brighten Optix vs. Arbor Technology | Brighten Optix vs. RiTdisplay Corp | Brighten Optix vs. Compal Broadband Networks | Brighten Optix vs. Univacco Technology |
| BenQ Medical vs. StShine Optical Co | BenQ Medical vs. Bioteque | BenQ Medical vs. TTY Biopharm Co | BenQ Medical vs. Apex Biotechnology Corp |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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