Correlation Between Biokarpet and J B
Can any of the company-specific risk be diversified away by investing in both Biokarpet and J B 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 Biokarpet and J B into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biokarpet SA and J B Ladenis, you can compare the effects of market volatilities on Biokarpet and J B 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 Biokarpet with a short position of J B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biokarpet and J B.
Diversification Opportunities for Biokarpet and J B
Very good diversification
The 3 months correlation between Biokarpet and MIN is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Biokarpet SA and J B Ladenis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J B Ladenis and Biokarpet 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 Biokarpet SA are associated (or correlated) with J B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J B Ladenis has no effect on the direction of Biokarpet i.e., Biokarpet and J B go up and down completely randomly.
Pair Corralation between Biokarpet and J B
Assuming the 90 days trading horizon Biokarpet is expected to generate 1.58 times less return on investment than J B. But when comparing it to its historical volatility, Biokarpet SA is 1.75 times less risky than J B. It trades about 0.02 of its potential returns per unit of risk. J B Ladenis is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 49.00 in J B Ladenis on October 31, 2024 and sell it today you would earn a total of 1.00 from holding J B Ladenis or generate 2.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biokarpet SA vs. J B Ladenis
Performance |
| Timeline |
| Biokarpet SA |
| J B Ladenis |
Biokarpet and J B Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biokarpet and J B
The main advantage of trading using opposite Biokarpet and J B positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biokarpet position performs unexpectedly, J B 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 J B will offset losses from the drop in J B's long position.| Biokarpet vs. EL D Mouzakis | Biokarpet vs. Nafpaktos Textile Industry | Biokarpet vs. Lanakam SA | Biokarpet vs. J B Ladenis |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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