Correlation Between BF Investment and Salzer Electronics
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By analyzing existing cross correlation between BF Investment Limited and Salzer Electronics Limited, you can compare the effects of market volatilities on BF Investment and Salzer Electronics 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 BF Investment with a short position of Salzer Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of BF Investment and Salzer Electronics.
Diversification Opportunities for BF Investment and Salzer Electronics
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BFINVEST and Salzer is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding BF Investment Limited and Salzer Electronics Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salzer Electronics and BF Investment 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 BF Investment Limited are associated (or correlated) with Salzer Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salzer Electronics has no effect on the direction of BF Investment i.e., BF Investment and Salzer Electronics go up and down completely randomly.
Pair Corralation between BF Investment and Salzer Electronics
Assuming the 90 days trading horizon BF Investment is expected to generate 2.43 times less return on investment than Salzer Electronics. But when comparing it to its historical volatility, BF Investment Limited is 1.02 times less risky than Salzer Electronics. It trades about 0.05 of its potential returns per unit of risk. Salzer Electronics Limited is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 27,232 in Salzer Electronics Limited on September 26, 2024 and sell it today you would earn a total of 123,353 from holding Salzer Electronics Limited or generate 452.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.39% |
| Values | Daily Returns |
BF Investment Limited vs. Salzer Electronics Limited
Performance |
| Timeline |
| BF Investment Limited |
| Salzer Electronics |
BF Investment and Salzer Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BF Investment and Salzer Electronics
The main advantage of trading using opposite BF Investment and Salzer Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BF Investment position performs unexpectedly, Salzer Electronics 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 Salzer Electronics will offset losses from the drop in Salzer Electronics' long position.| BF Investment vs. Kaushalya Infrastructure Development | BF Investment vs. Tarapur Transformers Limited | BF Investment vs. Kingfa Science Technology | BF Investment vs. Rico Auto Industries |
| Salzer Electronics vs. POWERGRID Infrastructure Investment | Salzer Electronics vs. BF Investment Limited | Salzer Electronics vs. Repco Home Finance | Salzer Electronics vs. Industrial 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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