Correlation Between BHPA and Protek Capital
Can any of the company-specific risk be diversified away by investing in both BHPA and Protek 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 BHPA and Protek Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BHPA Inc and Protek Capital, you can compare the effects of market volatilities on BHPA and Protek 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 BHPA with a short position of Protek Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of BHPA and Protek Capital.
Diversification Opportunities for BHPA and Protek Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BHPA and Protek is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BHPA Inc and Protek Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protek Capital and BHPA 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 BHPA Inc are associated (or correlated) with Protek Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protek Capital has no effect on the direction of BHPA i.e., BHPA and Protek Capital go up and down completely randomly.
Pair Corralation between BHPA and Protek Capital
If you would invest 0.40 in BHPA Inc on August 28, 2024 and sell it today you would earn a total of 0.10 from holding BHPA Inc or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BHPA Inc vs. Protek Capital
Performance |
| Timeline |
| BHPA Inc |
| Protek Capital |
BHPA and Protek Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BHPA and Protek Capital
The main advantage of trading using opposite BHPA and Protek Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BHPA position performs unexpectedly, Protek 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 Protek Capital will offset losses from the drop in Protek Capital's long position.The idea behind BHPA Inc and Protek Capital pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Protek Capital vs. Salesforce | Protek Capital vs. SAP SE ADR | Protek Capital vs. ServiceNow | Protek Capital vs. Intuit Inc |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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