Correlation Between Brockhaus Capital and North American
Can any of the company-specific risk be diversified away by investing in both Brockhaus Capital and North American 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 Brockhaus Capital and North American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brockhaus Capital Management and North American Construction, you can compare the effects of market volatilities on Brockhaus Capital and North American 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 Brockhaus Capital with a short position of North American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brockhaus Capital and North American.
Diversification Opportunities for Brockhaus Capital and North American
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Brockhaus and North is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Brockhaus Capital Management and North American Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North American Const and Brockhaus Capital 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 Brockhaus Capital Management are associated (or correlated) with North American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North American Const has no effect on the direction of Brockhaus Capital i.e., Brockhaus Capital and North American go up and down completely randomly.
Pair Corralation between Brockhaus Capital and North American
Assuming the 90 days trading horizon Brockhaus Capital Management is expected to under-perform the North American. In addition to that, Brockhaus Capital is 1.04 times more volatile than North American Construction. It trades about -0.05 of its total potential returns per unit of risk. North American Construction is currently generating about 0.05 per unit of volatility. If you would invest 1,718 in North American Construction on September 25, 2024 and sell it today you would earn a total of 242.00 from holding North American Construction or generate 14.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brockhaus Capital Management vs. North American Construction
Performance |
| Timeline |
| Brockhaus Capital |
| North American Const |
Brockhaus Capital and North American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brockhaus Capital and North American
The main advantage of trading using opposite Brockhaus Capital and North American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brockhaus Capital position performs unexpectedly, North American 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 North American will offset losses from the drop in North American's long position.| Brockhaus Capital vs. PLAY2CHILL SA ZY | Brockhaus Capital vs. KRAKATAU STEEL B | Brockhaus Capital vs. USWE SPORTS AB | Brockhaus Capital vs. Tianjin Capital Environmental |
| North American vs. Avanos Medical | North American vs. Tsingtao Brewery | North American vs. ONWARD MEDICAL BV | North American vs. Zijin Mining Group |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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