Correlation Between Beowulf Mining and BW Offshore
Can any of the company-specific risk be diversified away by investing in both Beowulf Mining and BW Offshore 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 Beowulf Mining and BW Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beowulf Mining and BW Offshore, you can compare the effects of market volatilities on Beowulf Mining and BW Offshore 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 Beowulf Mining with a short position of BW Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beowulf Mining and BW Offshore.
Diversification Opportunities for Beowulf Mining and BW Offshore
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Beowulf and 0RKH is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Beowulf Mining and BW Offshore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BW Offshore and Beowulf Mining 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 Beowulf Mining are associated (or correlated) with BW Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BW Offshore has no effect on the direction of Beowulf Mining i.e., Beowulf Mining and BW Offshore go up and down completely randomly.
Pair Corralation between Beowulf Mining and BW Offshore
Assuming the 90 days trading horizon Beowulf Mining is expected to under-perform the BW Offshore. In addition to that, Beowulf Mining is 2.47 times more volatile than BW Offshore. It trades about -0.06 of its total potential returns per unit of risk. BW Offshore is currently generating about 0.16 per unit of volatility. If you would invest 2,793 in BW Offshore on November 4, 2024 and sell it today you would earn a total of 355.00 from holding BW Offshore or generate 12.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beowulf Mining vs. BW Offshore
Performance |
| Timeline |
| Beowulf Mining |
| BW Offshore |
Beowulf Mining and BW Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beowulf Mining and BW Offshore
The main advantage of trading using opposite Beowulf Mining and BW Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beowulf Mining position performs unexpectedly, BW Offshore 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 BW Offshore will offset losses from the drop in BW Offshore's long position.| Beowulf Mining vs. Lowland Investment Co | Beowulf Mining vs. Verizon Communications | Beowulf Mining vs. JPMorgan Japanese Investment | Beowulf Mining vs. Gamma Communications PLC |
| BW Offshore vs. DXC Technology Co | BW Offshore vs. EJF Investments | BW Offshore vs. Seraphim Space Investment | BW Offshore vs. Monks Investment Trust |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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