Correlation Between Bewhere Holdings and Nexoptic Technology
Can any of the company-specific risk be diversified away by investing in both Bewhere Holdings and Nexoptic Technology 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 Bewhere Holdings and Nexoptic Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bewhere Holdings and Nexoptic Technology Corp, you can compare the effects of market volatilities on Bewhere Holdings and Nexoptic Technology 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 Bewhere Holdings with a short position of Nexoptic Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bewhere Holdings and Nexoptic Technology.
Diversification Opportunities for Bewhere Holdings and Nexoptic Technology
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bewhere and Nexoptic is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Bewhere Holdings and Nexoptic Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexoptic Technology Corp and Bewhere Holdings 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 Bewhere Holdings are associated (or correlated) with Nexoptic Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexoptic Technology Corp has no effect on the direction of Bewhere Holdings i.e., Bewhere Holdings and Nexoptic Technology go up and down completely randomly.
Pair Corralation between Bewhere Holdings and Nexoptic Technology
Assuming the 90 days horizon Bewhere Holdings is expected to under-perform the Nexoptic Technology. But the stock apears to be less risky and, when comparing its historical volatility, Bewhere Holdings is 3.17 times less risky than Nexoptic Technology. The stock trades about -0.15 of its potential returns per unit of risk. The Nexoptic Technology Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 4.00 in Nexoptic Technology Corp on September 5, 2024 and sell it today you would earn a total of 0.00 from holding Nexoptic Technology Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bewhere Holdings vs. Nexoptic Technology Corp
Performance |
| Timeline |
| Bewhere Holdings |
| Nexoptic Technology Corp |
Bewhere Holdings and Nexoptic Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bewhere Holdings and Nexoptic Technology
The main advantage of trading using opposite Bewhere Holdings and Nexoptic Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bewhere Holdings position performs unexpectedly, Nexoptic Technology 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 Nexoptic Technology will offset losses from the drop in Nexoptic Technology's long position.| Bewhere Holdings vs. Edgewater Wireless Systems | Bewhere Holdings vs. Current Water Technologies | Bewhere Holdings vs. Sparta Capital | Bewhere Holdings vs. Fintech Select |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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