Correlation Between BCE and Mapletree Logistics
Can any of the company-specific risk be diversified away by investing in both BCE and Mapletree Logistics 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 BCE and Mapletree Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BCE Inc and Mapletree Logistics Trust, you can compare the effects of market volatilities on BCE and Mapletree Logistics 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 BCE with a short position of Mapletree Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of BCE and Mapletree Logistics.
Diversification Opportunities for BCE and Mapletree Logistics
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BCE and Mapletree is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding BCE Inc and Mapletree Logistics Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mapletree Logistics Trust and BCE 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 BCE Inc are associated (or correlated) with Mapletree Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mapletree Logistics Trust has no effect on the direction of BCE i.e., BCE and Mapletree Logistics go up and down completely randomly.
Pair Corralation between BCE and Mapletree Logistics
Considering the 90-day investment horizon BCE Inc is expected to generate 0.99 times more return on investment than Mapletree Logistics. However, BCE Inc is 1.01 times less risky than Mapletree Logistics. It trades about -0.29 of its potential returns per unit of risk. Mapletree Logistics Trust is currently generating about -0.35 per unit of risk. If you would invest 2,769 in BCE Inc on September 13, 2024 and sell it today you would lose (190.00) from holding BCE Inc or give up 6.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
BCE Inc vs. Mapletree Logistics Trust
Performance |
| Timeline |
| BCE Inc |
| Mapletree Logistics Trust |
BCE and Mapletree Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BCE and Mapletree Logistics
The main advantage of trading using opposite BCE and Mapletree Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BCE position performs unexpectedly, Mapletree Logistics 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 Mapletree Logistics will offset losses from the drop in Mapletree Logistics' long position.The idea behind BCE Inc and Mapletree Logistics Trust pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Mapletree Logistics vs. Biglari Holdings | Mapletree Logistics vs. The Cheesecake Factory | Mapletree Logistics vs. Dennys Corp | Mapletree Logistics vs. Playa Hotels Resorts |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |