Correlation Between BBX Capital and Flow Capital
Can any of the company-specific risk be diversified away by investing in both BBX Capital and Flow Capital 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 BBX Capital and Flow Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BBX Capital and Flow Capital Corp, you can compare the effects of market volatilities on BBX Capital and Flow Capital 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 BBX Capital with a short position of Flow Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of BBX Capital and Flow Capital.
Diversification Opportunities for BBX Capital and Flow Capital
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BBX and Flow is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding BBX Capital and Flow Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flow Capital Corp and BBX Capital 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 BBX Capital are associated (or correlated) with Flow Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flow Capital Corp has no effect on the direction of BBX Capital i.e., BBX Capital and Flow Capital go up and down completely randomly.
Pair Corralation between BBX Capital and Flow Capital
Assuming the 90 days horizon BBX Capital is expected to generate 30.3 times less return on investment than Flow Capital. But when comparing it to its historical volatility, BBX Capital is 3.09 times less risky than Flow Capital. It trades about 0.01 of its potential returns per unit of risk. Flow Capital Corp is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 38.00 in Flow Capital Corp on September 3, 2024 and sell it today you would earn a total of 22.00 from holding Flow Capital Corp or generate 57.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 45.81% |
| Values | Daily Returns |
BBX Capital vs. Flow Capital Corp
Performance |
| Timeline |
| BBX Capital |
| Flow Capital Corp |
BBX Capital and Flow Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BBX Capital and Flow Capital
The main advantage of trading using opposite BBX Capital and Flow Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BBX Capital position performs unexpectedly, Flow Capital 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 Flow Capital will offset losses from the drop in Flow Capital's long position.| BBX Capital vs. Ameritrans Capital Corp | BBX Capital vs. Bounce Mobile Systems | BBX Capital vs. Elysee Development Corp | BBX Capital vs. AGF Management Limited |
| Flow Capital vs. Guardian Capital Group | Flow Capital vs. Urbana | Flow Capital vs. Princeton Capital | Flow Capital vs. Blackhawk Growth 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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