Correlation Between Bright Kindle and Allhome Corp
Can any of the company-specific risk be diversified away by investing in both Bright Kindle and Allhome Corp 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 Allhome Corp 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 Allhome Corp, you can compare the effects of market volatilities on Bright Kindle and Allhome Corp 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 Allhome Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bright Kindle and Allhome Corp.
Diversification Opportunities for Bright Kindle and Allhome Corp
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bright and Allhome is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Bright Kindle Resources and Allhome Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allhome Corp 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 Allhome Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allhome Corp has no effect on the direction of Bright Kindle i.e., Bright Kindle and Allhome Corp go up and down completely randomly.
Pair Corralation between Bright Kindle and Allhome Corp
Assuming the 90 days trading horizon Bright Kindle Resources is expected to generate 1.76 times more return on investment than Allhome Corp. However, Bright Kindle is 1.76 times more volatile than Allhome Corp. It trades about -0.02 of its potential returns per unit of risk. Allhome Corp is currently generating about -0.11 per unit of risk. If you would invest 118.00 in Bright Kindle Resources on August 29, 2024 and sell it today you would lose (48.00) from holding Bright Kindle Resources or give up 40.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 89.82% |
| Values | Daily Returns |
Bright Kindle Resources vs. Allhome Corp
Performance |
| Timeline |
| Bright Kindle Resources |
| Allhome Corp |
Bright Kindle and Allhome Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bright Kindle and Allhome Corp
The main advantage of trading using opposite Bright Kindle and Allhome Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bright Kindle position performs unexpectedly, Allhome Corp 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 Allhome Corp will offset losses from the drop in Allhome Corp's long position.| Bright Kindle vs. Allhome Corp | Bright Kindle vs. Jollibee Foods Corp | Bright Kindle vs. LFM Properties Corp | Bright Kindle vs. PXP Energy Corp |
| Allhome Corp vs. Metropolitan Bank Trust | Allhome Corp vs. Asia United Bank | Allhome Corp vs. BDO Unibank | Allhome Corp 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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