Correlation Between BK Technologies and Zepp Health
Can any of the company-specific risk be diversified away by investing in both BK Technologies and Zepp Health 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 BK Technologies and Zepp Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BK Technologies and Zepp Health Corp, you can compare the effects of market volatilities on BK Technologies and Zepp Health 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 BK Technologies with a short position of Zepp Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of BK Technologies and Zepp Health.
Diversification Opportunities for BK Technologies and Zepp Health
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BKTI and Zepp is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding BK Technologies and Zepp Health Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zepp Health Corp and BK Technologies 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 BK Technologies are associated (or correlated) with Zepp Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zepp Health Corp has no effect on the direction of BK Technologies i.e., BK Technologies and Zepp Health go up and down completely randomly.
Pair Corralation between BK Technologies and Zepp Health
Given the investment horizon of 90 days BK Technologies is expected to generate 0.91 times more return on investment than Zepp Health. However, BK Technologies is 1.1 times less risky than Zepp Health. It trades about 0.05 of its potential returns per unit of risk. Zepp Health Corp is currently generating about -0.02 per unit of risk. If you would invest 1,775 in BK Technologies on November 9, 2024 and sell it today you would earn a total of 1,559 from holding BK Technologies or generate 87.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BK Technologies vs. Zepp Health Corp
Performance |
| Timeline |
| BK Technologies |
| Zepp Health Corp |
BK Technologies and Zepp Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BK Technologies and Zepp Health
The main advantage of trading using opposite BK Technologies and Zepp Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BK Technologies position performs unexpectedly, Zepp Health 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 Zepp Health will offset losses from the drop in Zepp Health's long position.| BK Technologies vs. Frequency Electronics | BK Technologies vs. Actelis Networks | BK Technologies vs. Optical Cable | BK Technologies vs. Baylin Technologies |
| Zepp Health vs. VOXX International | Zepp Health vs. LG Display Co | Zepp Health vs. Emerson Radio | Zepp Health vs. Universal 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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