Correlation Between BitFrontier Capital and Formula Systems
Can any of the company-specific risk be diversified away by investing in both BitFrontier Capital and Formula Systems 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 BitFrontier Capital and Formula Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BitFrontier Capital Holdings and Formula Systems 1985, you can compare the effects of market volatilities on BitFrontier Capital and Formula Systems 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 BitFrontier Capital with a short position of Formula Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of BitFrontier Capital and Formula Systems.
Diversification Opportunities for BitFrontier Capital and Formula Systems
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BitFrontier and Formula is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding BitFrontier Capital Holdings and Formula Systems 1985 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Formula Systems 1985 and BitFrontier 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 BitFrontier Capital Holdings are associated (or correlated) with Formula Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Formula Systems 1985 has no effect on the direction of BitFrontier Capital i.e., BitFrontier Capital and Formula Systems go up and down completely randomly.
Pair Corralation between BitFrontier Capital and Formula Systems
Given the investment horizon of 90 days BitFrontier Capital Holdings is expected to generate 6.04 times more return on investment than Formula Systems. However, BitFrontier Capital is 6.04 times more volatile than Formula Systems 1985. It trades about 0.03 of its potential returns per unit of risk. Formula Systems 1985 is currently generating about 0.05 per unit of risk. If you would invest 0.91 in BitFrontier Capital Holdings on August 25, 2024 and sell it today you would lose (0.64) from holding BitFrontier Capital Holdings or give up 70.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BitFrontier Capital Holdings vs. Formula Systems 1985
Performance |
| Timeline |
| BitFrontier Capital |
| Formula Systems 1985 |
BitFrontier Capital and Formula Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BitFrontier Capital and Formula Systems
The main advantage of trading using opposite BitFrontier Capital and Formula Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BitFrontier Capital position performs unexpectedly, Formula Systems 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 Formula Systems will offset losses from the drop in Formula Systems' long position.| BitFrontier Capital vs. Morgan Stanley | BitFrontier Capital vs. Goldman Sachs Group | BitFrontier Capital vs. Charles Schwab Corp | BitFrontier Capital vs. Interactive Brokers Group |
| Formula Systems vs. Data Storage Corp | Formula Systems vs. Usio Inc | Formula Systems vs. ARB IOT Group | Formula Systems vs. FiscalNote Holdings |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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