Correlation Between Bell Financial and FleetPartners
Can any of the company-specific risk be diversified away by investing in both Bell Financial and FleetPartners 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 FleetPartners 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 FleetPartners Group, you can compare the effects of market volatilities on Bell Financial and FleetPartners 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 FleetPartners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bell Financial and FleetPartners.
Diversification Opportunities for Bell Financial and FleetPartners
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bell and FleetPartners is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Bell Financial Group and FleetPartners Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FleetPartners Group 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 FleetPartners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FleetPartners Group has no effect on the direction of Bell Financial i.e., Bell Financial and FleetPartners go up and down completely randomly.
Pair Corralation between Bell Financial and FleetPartners
Assuming the 90 days trading horizon Bell Financial is expected to generate 1.35 times less return on investment than FleetPartners. In addition to that, Bell Financial is 1.04 times more volatile than FleetPartners Group. It trades about 0.07 of its total potential returns per unit of risk. FleetPartners Group is currently generating about 0.1 per unit of volatility. If you would invest 294.00 in FleetPartners Group on September 14, 2024 and sell it today you would earn a total of 13.00 from holding FleetPartners Group or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bell Financial Group vs. FleetPartners Group
Performance |
| Timeline |
| Bell Financial Group |
| FleetPartners Group |
Bell Financial and FleetPartners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bell Financial and FleetPartners
The main advantage of trading using opposite Bell Financial and FleetPartners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bell Financial position performs unexpectedly, FleetPartners 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 FleetPartners will offset losses from the drop in FleetPartners' long position.| Bell Financial vs. REGAL ASIAN INVESTMENTS | Bell Financial vs. Auctus Alternative Investments | Bell Financial vs. Super Retail Group | Bell Financial vs. Charter Hall Education |
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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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