Correlation Between Big Time and EM
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By analyzing existing cross correlation between Big Time and EM, you can compare the effects of market volatilities on Big Time and EM 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 Big Time with a short position of EM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Big Time and EM.
Diversification Opportunities for Big Time and EM
Pay attention - limited upside
The 3 months correlation between Big and EM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Big Time and EM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EM and Big Time 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 Big Time are associated (or correlated) with EM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EM has no effect on the direction of Big Time i.e., Big Time and EM go up and down completely randomly.
Pair Corralation between Big Time and EM
If you would invest 15.00 in Big Time on September 4, 2024 and sell it today you would earn a total of 3.00 from holding Big Time or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Big Time vs. EM
Performance |
| Timeline |
| Big Time |
| EM |
Big Time and EM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Big Time and EM
The main advantage of trading using opposite Big Time and EM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Big Time position performs unexpectedly, EM 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 EM will offset losses from the drop in EM's long position.The idea behind Big Time and EM 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.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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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