Correlation Between Bel Fuse and Intelligent Bio
Can any of the company-specific risk be diversified away by investing in both Bel Fuse and Intelligent Bio 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 Bel Fuse and Intelligent Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bel Fuse A and Intelligent Bio Solutions, you can compare the effects of market volatilities on Bel Fuse and Intelligent Bio 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 Bel Fuse with a short position of Intelligent Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bel Fuse and Intelligent Bio.
Diversification Opportunities for Bel Fuse and Intelligent Bio
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bel and Intelligent is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Bel Fuse A and Intelligent Bio Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intelligent Bio Solutions and Bel Fuse 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 Bel Fuse A are associated (or correlated) with Intelligent Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intelligent Bio Solutions has no effect on the direction of Bel Fuse i.e., Bel Fuse and Intelligent Bio go up and down completely randomly.
Pair Corralation between Bel Fuse and Intelligent Bio
Assuming the 90 days horizon Bel Fuse A is expected to under-perform the Intelligent Bio. But the stock apears to be less risky and, when comparing its historical volatility, Bel Fuse A is 3.53 times less risky than Intelligent Bio. The stock trades about -0.07 of its potential returns per unit of risk. The Intelligent Bio Solutions is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 177.00 in Intelligent Bio Solutions on August 25, 2024 and sell it today you would lose (22.00) from holding Intelligent Bio Solutions or give up 12.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bel Fuse A vs. Intelligent Bio Solutions
Performance |
| Timeline |
| Bel Fuse A |
| Intelligent Bio Solutions |
Bel Fuse and Intelligent Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bel Fuse and Intelligent Bio
The main advantage of trading using opposite Bel Fuse and Intelligent Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bel Fuse position performs unexpectedly, Intelligent Bio 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 Intelligent Bio will offset losses from the drop in Intelligent Bio's long position.| Bel Fuse vs. Plexus Corp | Bel Fuse vs. Benchmark Electronics | Bel Fuse vs. Jabil Circuit | Bel Fuse vs. Sanmina |
| Intelligent Bio vs. FormFactor | Intelligent Bio vs. Apogee Enterprises | Intelligent Bio vs. Verra Mobility Corp | Intelligent Bio vs. Bel Fuse A |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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