Correlation Between BKI Investment and MA Financial
Can any of the company-specific risk be diversified away by investing in both BKI Investment and MA Financial 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 BKI Investment and MA Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BKI Investment and MA Financial Group, you can compare the effects of market volatilities on BKI Investment and MA Financial 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 BKI Investment with a short position of MA Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of BKI Investment and MA Financial.
Diversification Opportunities for BKI Investment and MA Financial
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BKI and MAF is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding BKI Investment and MA Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MA Financial Group and BKI Investment 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 BKI Investment are associated (or correlated) with MA Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MA Financial Group has no effect on the direction of BKI Investment i.e., BKI Investment and MA Financial go up and down completely randomly.
Pair Corralation between BKI Investment and MA Financial
Assuming the 90 days trading horizon BKI Investment is expected to generate 0.23 times more return on investment than MA Financial. However, BKI Investment is 4.28 times less risky than MA Financial. It trades about 0.1 of its potential returns per unit of risk. MA Financial Group is currently generating about -0.03 per unit of risk. If you would invest 171.00 in BKI Investment on October 13, 2024 and sell it today you would earn a total of 2.00 from holding BKI Investment or generate 1.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BKI Investment vs. MA Financial Group
Performance |
| Timeline |
| BKI Investment |
| MA Financial Group |
BKI Investment and MA Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BKI Investment and MA Financial
The main advantage of trading using opposite BKI Investment and MA Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BKI Investment position performs unexpectedly, MA Financial 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 MA Financial will offset losses from the drop in MA Financial's long position.| BKI Investment vs. Dug Technology | BKI Investment vs. Ainsworth Game Technology | BKI Investment vs. Pinnacle Investment Management | BKI Investment vs. Auctus Alternative Investments |
| MA Financial vs. Argo Investments | MA Financial vs. Zoom2u Technologies | MA Financial vs. Computershare | MA Financial vs. BKI 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |