Correlation Between BGT Public and AIRA Capital
Can any of the company-specific risk be diversified away by investing in both BGT Public and AIRA Capital 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 BGT Public and AIRA Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BGT Public and AIRA Capital Public, you can compare the effects of market volatilities on BGT Public and AIRA Capital 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 BGT Public with a short position of AIRA Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of BGT Public and AIRA Capital.
Diversification Opportunities for BGT Public and AIRA Capital
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between BGT and AIRA is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding BGT Public and AIRA Capital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIRA Capital Public and BGT Public 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 BGT Public are associated (or correlated) with AIRA Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIRA Capital Public has no effect on the direction of BGT Public i.e., BGT Public and AIRA Capital go up and down completely randomly.
Pair Corralation between BGT Public and AIRA Capital
Assuming the 90 days trading horizon BGT Public is expected to generate 0.53 times more return on investment than AIRA Capital. However, BGT Public is 1.87 times less risky than AIRA Capital. It trades about -0.17 of its potential returns per unit of risk. AIRA Capital Public is currently generating about -0.09 per unit of risk. If you would invest 58.00 in BGT Public on September 3, 2024 and sell it today you would lose (5.00) from holding BGT Public or give up 8.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BGT Public vs. AIRA Capital Public
Performance |
| Timeline |
| BGT Public |
| AIRA Capital Public |
BGT Public and AIRA Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BGT Public and AIRA Capital
The main advantage of trading using opposite BGT Public and AIRA Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BGT Public position performs unexpectedly, AIRA Capital 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 AIRA Capital will offset losses from the drop in AIRA Capital's long position.| BGT Public vs. Cho Thavee Public | BGT Public vs. G Capital Public | BGT Public vs. CI Group Public | BGT Public vs. ASIA Capital Group |
| AIRA Capital vs. Delta Electronics Public | AIRA Capital vs. Delta Electronics Public | AIRA Capital vs. Airports of Thailand | AIRA Capital vs. Airports of Thailand |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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