Correlation Between PKSHA TECHNOLOGY and BW OFFSHORE
Can any of the company-specific risk be diversified away by investing in both PKSHA TECHNOLOGY and BW OFFSHORE 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 PKSHA TECHNOLOGY and BW OFFSHORE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PKSHA TECHNOLOGY INC and BW OFFSHORE LTD, you can compare the effects of market volatilities on PKSHA TECHNOLOGY and BW OFFSHORE 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 PKSHA TECHNOLOGY with a short position of BW OFFSHORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of PKSHA TECHNOLOGY and BW OFFSHORE.
Diversification Opportunities for PKSHA TECHNOLOGY and BW OFFSHORE
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PKSHA and XY81 is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding PKSHA TECHNOLOGY INC and BW OFFSHORE LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BW OFFSHORE LTD and PKSHA TECHNOLOGY 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 PKSHA TECHNOLOGY INC are associated (or correlated) with BW OFFSHORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BW OFFSHORE LTD has no effect on the direction of PKSHA TECHNOLOGY i.e., PKSHA TECHNOLOGY and BW OFFSHORE go up and down completely randomly.
Pair Corralation between PKSHA TECHNOLOGY and BW OFFSHORE
Assuming the 90 days horizon PKSHA TECHNOLOGY INC is expected to under-perform the BW OFFSHORE. In addition to that, PKSHA TECHNOLOGY is 1.74 times more volatile than BW OFFSHORE LTD. It trades about -0.04 of its total potential returns per unit of risk. BW OFFSHORE LTD is currently generating about 0.05 per unit of volatility. If you would invest 200.00 in BW OFFSHORE LTD on September 1, 2024 and sell it today you would earn a total of 33.00 from holding BW OFFSHORE LTD or generate 16.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PKSHA TECHNOLOGY INC vs. BW OFFSHORE LTD
Performance |
| Timeline |
| PKSHA TECHNOLOGY INC |
| BW OFFSHORE LTD |
PKSHA TECHNOLOGY and BW OFFSHORE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PKSHA TECHNOLOGY and BW OFFSHORE
The main advantage of trading using opposite PKSHA TECHNOLOGY and BW OFFSHORE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PKSHA TECHNOLOGY position performs unexpectedly, BW OFFSHORE 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 BW OFFSHORE will offset losses from the drop in BW OFFSHORE's long position.| PKSHA TECHNOLOGY vs. Liberty Broadband | PKSHA TECHNOLOGY vs. COMPUTERSHARE | PKSHA TECHNOLOGY vs. Internet Thailand PCL | PKSHA TECHNOLOGY vs. Cars Inc |
| BW OFFSHORE vs. Zurich Insurance Group | BW OFFSHORE vs. NIPPON MEAT PACKERS | BW OFFSHORE vs. PT Indofood Sukses | BW OFFSHORE vs. JJ SNACK FOODS |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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