Correlation Between Bright Kindle and Bank of the
Can any of the company-specific risk be diversified away by investing in both Bright Kindle and Bank of the 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 Bright Kindle and Bank of the into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bright Kindle Resources and Bank of the, you can compare the effects of market volatilities on Bright Kindle and Bank of the 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 Bright Kindle with a short position of Bank of the. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bright Kindle and Bank of the.
Diversification Opportunities for Bright Kindle and Bank of the
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bright and Bank is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Bright Kindle Resources and Bank of the in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of the and Bright Kindle 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 Bright Kindle Resources are associated (or correlated) with Bank of the. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of the has no effect on the direction of Bright Kindle i.e., Bright Kindle and Bank of the go up and down completely randomly.
Pair Corralation between Bright Kindle and Bank of the
Assuming the 90 days trading horizon Bright Kindle Resources is expected to generate 6.76 times more return on investment than Bank of the. However, Bright Kindle is 6.76 times more volatile than Bank of the. It trades about 0.19 of its potential returns per unit of risk. Bank of the is currently generating about -0.01 per unit of risk. If you would invest 99.00 in Bright Kindle Resources on October 26, 2024 and sell it today you would earn a total of 25.00 from holding Bright Kindle Resources or generate 25.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 88.89% |
| Values | Daily Returns |
Bright Kindle Resources vs. Bank of the
Performance |
| Timeline |
| Bright Kindle Resources |
| Bank of the |
Bright Kindle and Bank of the Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bright Kindle and Bank of the
The main advantage of trading using opposite Bright Kindle and Bank of the positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bright Kindle position performs unexpectedly, Bank of the 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 Bank of the will offset losses from the drop in Bank of the's long position.| Bright Kindle vs. Century Pacific Food | Bright Kindle vs. Transpacific Broadband Group | Bright Kindle vs. Philex Mining Corp | Bright Kindle vs. STI Education Systems |
| Bank of the vs. Metropolitan Bank Trust | Bank of the vs. National Reinsurance | Bank of the vs. STI Education Systems | Bank of the vs. Integrated Micro Electronics |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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