Correlation Between Mauna Kea and BEBO Health
Can any of the company-specific risk be diversified away by investing in both Mauna Kea and BEBO Health 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 Mauna Kea and BEBO Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mauna Kea Technologies and BEBO Health SA, you can compare the effects of market volatilities on Mauna Kea and BEBO Health 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 Mauna Kea with a short position of BEBO Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mauna Kea and BEBO Health.
Diversification Opportunities for Mauna Kea and BEBO Health
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mauna and BEBO is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Mauna Kea Technologies and BEBO Health SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BEBO Health SA and Mauna Kea 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 Mauna Kea Technologies are associated (or correlated) with BEBO Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BEBO Health SA has no effect on the direction of Mauna Kea i.e., Mauna Kea and BEBO Health go up and down completely randomly.
Pair Corralation between Mauna Kea and BEBO Health
Assuming the 90 days trading horizon Mauna Kea Technologies is expected to under-perform the BEBO Health. In addition to that, Mauna Kea is 1.58 times more volatile than BEBO Health SA. It trades about -0.15 of its total potential returns per unit of risk. BEBO Health SA is currently generating about -0.12 per unit of volatility. If you would invest 398.00 in BEBO Health SA on September 1, 2024 and sell it today you would lose (154.00) from holding BEBO Health SA or give up 38.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mauna Kea Technologies vs. BEBO Health SA
Performance |
| Timeline |
| Mauna Kea Technologies |
| BEBO Health SA |
Mauna Kea and BEBO Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mauna Kea and BEBO Health
The main advantage of trading using opposite Mauna Kea and BEBO Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mauna Kea position performs unexpectedly, BEBO Health 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 BEBO Health will offset losses from the drop in BEBO Health's long position.| Mauna Kea vs. LVMH Mot Hennessy | Mauna Kea vs. LOreal SA | Mauna Kea vs. Hermes International SCA | Mauna Kea vs. Manitou BF SA |
| BEBO Health vs. Jacquet Metal Service | BEBO Health vs. Affluent Medical SAS | BEBO Health vs. Fiducial Office Solutions | BEBO Health vs. Guandao Puer Investment |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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