Correlation Between Bell Financial and Boss Energy
Can any of the company-specific risk be diversified away by investing in both Bell Financial and Boss Energy 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 Bell Financial and Boss Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bell Financial Group and Boss Energy Limited, you can compare the effects of market volatilities on Bell Financial and Boss Energy 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 Bell Financial with a short position of Boss Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bell Financial and Boss Energy.
Diversification Opportunities for Bell Financial and Boss Energy
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bell and Boss is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Bell Financial Group and Boss Energy Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boss Energy Limited and Bell Financial 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 Bell Financial Group are associated (or correlated) with Boss Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boss Energy Limited has no effect on the direction of Bell Financial i.e., Bell Financial and Boss Energy go up and down completely randomly.
Pair Corralation between Bell Financial and Boss Energy
Assuming the 90 days trading horizon Bell Financial Group is expected to generate 0.58 times more return on investment than Boss Energy. However, Bell Financial Group is 1.72 times less risky than Boss Energy. It trades about 0.05 of its potential returns per unit of risk. Boss Energy Limited is currently generating about 0.03 per unit of risk. If you would invest 87.00 in Bell Financial Group on September 5, 2024 and sell it today you would earn a total of 45.00 from holding Bell Financial Group or generate 51.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bell Financial Group vs. Boss Energy Limited
Performance |
| Timeline |
| Bell Financial Group |
| Boss Energy Limited |
Bell Financial and Boss Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bell Financial and Boss Energy
The main advantage of trading using opposite Bell Financial and Boss Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bell Financial position performs unexpectedly, Boss Energy 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 Boss Energy will offset losses from the drop in Boss Energy's long position.| Bell Financial vs. Audio Pixels Holdings | Bell Financial vs. Iodm | Bell Financial vs. Nsx | Bell Financial vs. TTG Fintech |
| Boss Energy vs. Retail Food Group | Boss Energy vs. Bell Financial Group | Boss Energy vs. Qbe Insurance Group | Boss Energy vs. Magellan Financial Group |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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