Correlation Between Bantek and Woodward
Can any of the company-specific risk be diversified away by investing in both Bantek and Woodward 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 Bantek and Woodward into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bantek Inc and Woodward, you can compare the effects of market volatilities on Bantek and Woodward 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 Bantek with a short position of Woodward. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bantek and Woodward.
Diversification Opportunities for Bantek and Woodward
Very good diversification
The 3 months correlation between Bantek and Woodward is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Bantek Inc and Woodward in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Woodward and Bantek 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 Bantek Inc are associated (or correlated) with Woodward. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Woodward has no effect on the direction of Bantek i.e., Bantek and Woodward go up and down completely randomly.
Pair Corralation between Bantek and Woodward
Given the investment horizon of 90 days Bantek Inc is expected to generate 9.12 times more return on investment than Woodward. However, Bantek is 9.12 times more volatile than Woodward. It trades about 0.06 of its potential returns per unit of risk. Woodward is currently generating about 0.0 per unit of risk. If you would invest 0.42 in Bantek Inc on September 3, 2024 and sell it today you would lose (0.24) from holding Bantek Inc or give up 57.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bantek Inc vs. Woodward
Performance |
| Timeline |
| Bantek Inc |
| Woodward |
Bantek and Woodward Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bantek and Woodward
The main advantage of trading using opposite Bantek and Woodward positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bantek position performs unexpectedly, Woodward 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 Woodward will offset losses from the drop in Woodward's long position.| Bantek vs. Rolls Royce Holdings plc | Bantek vs. Byrna Technologies | Bantek vs. Austal Limited | Bantek vs. Astronics |
| Woodward vs. Hexcel | Woodward vs. Ducommun Incorporated | Woodward vs. Mercury Systems | Woodward vs. AAR 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |