Correlation Between Baker Hughes and Aquafil SpA
Can any of the company-specific risk be diversified away by investing in both Baker Hughes and Aquafil SpA 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 Baker Hughes and Aquafil SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baker Hughes Co and Aquafil SpA, you can compare the effects of market volatilities on Baker Hughes and Aquafil SpA 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 Baker Hughes with a short position of Aquafil SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baker Hughes and Aquafil SpA.
Diversification Opportunities for Baker Hughes and Aquafil SpA
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Baker and Aquafil is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Baker Hughes Co and Aquafil SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquafil SpA and Baker Hughes 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 Baker Hughes Co are associated (or correlated) with Aquafil SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquafil SpA has no effect on the direction of Baker Hughes i.e., Baker Hughes and Aquafil SpA go up and down completely randomly.
Pair Corralation between Baker Hughes and Aquafil SpA
Considering the 90-day investment horizon Baker Hughes Co is expected to generate 0.45 times more return on investment than Aquafil SpA. However, Baker Hughes Co is 2.21 times less risky than Aquafil SpA. It trades about 0.08 of its potential returns per unit of risk. Aquafil SpA is currently generating about -0.13 per unit of risk. If you would invest 3,297 in Baker Hughes Co on August 24, 2024 and sell it today you would earn a total of 1,191 from holding Baker Hughes Co or generate 36.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Baker Hughes Co vs. Aquafil SpA
Performance |
| Timeline |
| Baker Hughes |
| Aquafil SpA |
Baker Hughes and Aquafil SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baker Hughes and Aquafil SpA
The main advantage of trading using opposite Baker Hughes and Aquafil SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baker Hughes position performs unexpectedly, Aquafil SpA 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 Aquafil SpA will offset losses from the drop in Aquafil SpA's long position.| Baker Hughes vs. Schlumberger NV | Baker Hughes vs. NOV Inc | Baker Hughes vs. Weatherford International PLC | Baker Hughes vs. Tenaris SA ADR |
| Aquafil SpA vs. AKITA Drilling | Aquafil SpA vs. Amgen Inc | Aquafil SpA vs. Transocean | Aquafil SpA vs. Mangazeya Mining |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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