Correlation Between BASE and Peer To
Can any of the company-specific risk be diversified away by investing in both BASE and Peer To 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 BASE and Peer To into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BASE Inc and Peer To Peer, you can compare the effects of market volatilities on BASE and Peer To 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 BASE with a short position of Peer To. Check out your portfolio center. Please also check ongoing floating volatility patterns of BASE and Peer To.
Diversification Opportunities for BASE and Peer To
Good diversification
The 3 months correlation between BASE and Peer is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding BASE Inc and Peer To Peer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peer To Peer and BASE 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 BASE Inc are associated (or correlated) with Peer To. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peer To Peer has no effect on the direction of BASE i.e., BASE and Peer To go up and down completely randomly.
Pair Corralation between BASE and Peer To
Assuming the 90 days horizon BASE Inc is expected to under-perform the Peer To. But the pink sheet apears to be less risky and, when comparing its historical volatility, BASE Inc is 25.07 times less risky than Peer To. The pink sheet trades about -0.22 of its potential returns per unit of risk. The Peer To Peer is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 0.02 in Peer To Peer on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Peer To Peer or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BASE Inc vs. Peer To Peer
Performance |
| Timeline |
| BASE Inc |
| Peer To Peer |
BASE and Peer To Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BASE and Peer To
The main advantage of trading using opposite BASE and Peer To positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BASE position performs unexpectedly, Peer To 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 Peer To will offset losses from the drop in Peer To's long position.| BASE vs. CurrentC Power | BASE vs. Agent Information Software | BASE vs. Auddia Inc | BASE vs. Maxwell Resource |
| Peer To vs. AB International Group | Peer To vs. AppYea Inc | Peer To vs. Protek Capital | Peer To vs. ANSYS Inc |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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