Correlation Between BSP Financial and Energy Resources
Can any of the company-specific risk be diversified away by investing in both BSP Financial and Energy Resources 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 BSP Financial and Energy Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BSP Financial Group and Energy Resources, you can compare the effects of market volatilities on BSP Financial and Energy Resources 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 BSP Financial with a short position of Energy Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of BSP Financial and Energy Resources.
Diversification Opportunities for BSP Financial and Energy Resources
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between BSP and Energy is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding BSP Financial Group and Energy Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Resources and BSP 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 BSP Financial Group are associated (or correlated) with Energy Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Resources has no effect on the direction of BSP Financial i.e., BSP Financial and Energy Resources go up and down completely randomly.
Pair Corralation between BSP Financial and Energy Resources
Assuming the 90 days trading horizon BSP Financial Group is expected to under-perform the Energy Resources. But the stock apears to be less risky and, when comparing its historical volatility, BSP Financial Group is 9.04 times less risky than Energy Resources. The stock trades about 0.0 of its potential returns per unit of risk. The Energy Resources is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 4.90 in Energy Resources on August 25, 2024 and sell it today you would lose (4.60) from holding Energy Resources or give up 93.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BSP Financial Group vs. Energy Resources
Performance |
| Timeline |
| BSP Financial Group |
| Energy Resources |
BSP Financial and Energy Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BSP Financial and Energy Resources
The main advantage of trading using opposite BSP Financial and Energy Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BSP Financial position performs unexpectedly, Energy Resources 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 Energy Resources will offset losses from the drop in Energy Resources' long position.| BSP Financial vs. Energy Resources | BSP Financial vs. 88 Energy | BSP Financial vs. Amani Gold | BSP Financial vs. A1 Investments Resources |
| Energy Resources vs. Westpac Banking | Energy Resources vs. ABACUS STORAGE KING | Energy Resources vs. Odyssey Energy | Energy Resources vs. Insurance Australia 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |