Correlation Between BHG Group and Goodbye Kansas
Can any of the company-specific risk be diversified away by investing in both BHG Group and Goodbye Kansas 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 BHG Group and Goodbye Kansas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BHG Group AB and Goodbye Kansas Group, you can compare the effects of market volatilities on BHG Group and Goodbye Kansas 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 BHG Group with a short position of Goodbye Kansas. Check out your portfolio center. Please also check ongoing floating volatility patterns of BHG Group and Goodbye Kansas.
Diversification Opportunities for BHG Group and Goodbye Kansas
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between BHG and Goodbye is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding BHG Group AB and Goodbye Kansas Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goodbye Kansas Group and BHG Group 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 BHG Group AB are associated (or correlated) with Goodbye Kansas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goodbye Kansas Group has no effect on the direction of BHG Group i.e., BHG Group and Goodbye Kansas go up and down completely randomly.
Pair Corralation between BHG Group and Goodbye Kansas
Assuming the 90 days trading horizon BHG Group is expected to generate 1.4 times less return on investment than Goodbye Kansas. But when comparing it to its historical volatility, BHG Group AB is 1.25 times less risky than Goodbye Kansas. It trades about 0.11 of its potential returns per unit of risk. Goodbye Kansas Group is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 134.00 in Goodbye Kansas Group on September 24, 2024 and sell it today you would earn a total of 13.00 from holding Goodbye Kansas Group or generate 9.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BHG Group AB vs. Goodbye Kansas Group
Performance |
| Timeline |
| BHG Group AB |
| Goodbye Kansas Group |
BHG Group and Goodbye Kansas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BHG Group and Goodbye Kansas
The main advantage of trading using opposite BHG Group and Goodbye Kansas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BHG Group position performs unexpectedly, Goodbye Kansas 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 Goodbye Kansas will offset losses from the drop in Goodbye Kansas' long position.| BHG Group vs. Cint Group AB | BHG Group vs. Desenio Group AB | BHG Group vs. Fractal Gaming Group | BHG Group vs. Pierce Group AB |
| Goodbye Kansas vs. Modern Times Group | Goodbye Kansas vs. Millicom International Cellular | Goodbye Kansas vs. Tele2 AB | Goodbye Kansas vs. BHG Group AB |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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